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!ase or !olle!tion o a su o oney plus daages beore t"etrial !ourt.

T"e Oi!e o t"e oli!itor &eneral aintains t"at t"eObudsan approved t"e re!oendation o t"einvestigating oi!er to disiss t"e !oplaint be!ause "esin!erely believed t"ere was no sui!ient basis or t"e!riinal indi!tent o private respondents.

Ee ind no grave abuse o dis!retion !oitted by t"eObudsan. COCOFED v. PCGG reerred to in Republic v.Sandiganbayan reviewed t"e "istory o t"e !o!onut levyunds. T"ese unds a!tually "ave our (A) general !lasses: (a)t"e Co!onut Investent Fund !reated under -. '. o. 6<6>; ?

(b) t"e Co!onut Consuers tabiliBation Fund !reated under . . o. <76;9 (!) t"e Co!onut Industry evelopent Fund!reated under . . o. =?<; 1> and, (d) t"e Co!onut IndustrytabiliBation Fund !reated under . . o. 1?A1. 11

T"e various laws relating to t"e !o!onut industry were!odiied in 1976. On <1 O!tober o t"at year, . . o. 961 1<

was proulgated. On 11 8une 197? it was aended by . .

o. 1A6?15

by inserting a new provision aut"oriBing t"e use o t"e balan!e o t"e Co!onut Industry evelopent Fund or t"ea!uisition o s"ares o sto!2s in !orporations organiBed or t"e purpose o engaging in t"e establis"ent and operation o industries . . . !oer!ial a!tivities and ot"er allied businessunderta2ings relating to !o!onut and ot"er pal oilindust(ries). 1A Fro t"is und t"us !reated, or t"e CIIF, s"areso sto!2 in w"at "ave !oe to be 2nown as t"e CIIF!opanies were pur!"ased.

Ee t"en stated in COCOF% t"at t"e !o!onut levy unds wereraised by t"e tateDs poli!e and ta*ing powers su!" t"at t"eutiliBation and proper anageent t"ereo were !ertainly t"e

!on!ern o t"e &overnent. T"ese unds "ave a publi!!"ara!ter and are !learly ae!ted wit" publi! interest.

Quimpo v. !anodbayan involved t"e issue as to w"et"er %T-OI$ was a governent owned or !ontrolled!orporation t"e eployees o w"i!" ell wit"in t"e 3urisdi!tional purview o t"e Tanodbayan or purposes o T"e'nti#&rat and Corrupt ra!ti!es '!t. Ee up"eld t"e 3urisdi!tion o t"e Tanodbayan on t"e ratio!ination t"at @

E"ile it ay be t"at %T-OI$ was not originally!reated as a governent#owned or !ontrolled!orporation, ater it was a!uired by OC, w"i!" is

a governent#owned or !ontrolled !orporation,%T-OI$ be!ae a subsidiary o OC and t"uss"ed#o its private status. It is now unded andowned by t"e governent as, in a!t, it was a!uiredto peror un!tions related to governent prograsand poli!ies on oil, a vital !oodity in t"ee!onoi! lie o t"e nation. It was a!uired notteporarily but as a peranent ad3un!t to peroressential governent or governent#relatedun!tions, as t"e ar2eting ar o t"e OC to assistt"e latter in selling and distributing oil and petroleu produ!ts to assure and aintain an adeuate andstable doesti! supply.

4ut t"ese 3urisprudential rules invo2ed by petitioner in supporto "is !lai t"at t"e CIIF !opanies are governent ownedandor !ontrolled !orporations are in!oplete wit"ouresorting to t"e deinition o governent owned or !ontrolled!orporation !ontained in par. (15), e!. <, Introdu!toryrovisions o t"e 'dinistrative Code o 19?7, i. e., anyagen!y organiBed as a sto!2 or non#sto!2 !orporation vestedwit" un!tions relating to publi! needs w"et"er governentalor proprietary in nature, and owned by t"e &overnentdire!tly or t"roug" its instruentalities eit"er w"olly, orw"ere appli!able as in t"e !ase o sto!2 !orporations, to t"ee*tent o at least ity#one (=1) per!ent o its !apital sto!2. T"edeinition entions t"ree (5) reuisites, naely, irst, anyagen!y organiBed as a sto!2 or non#sto!2 !orporation; se!ondvested wit" un!tions relating to publi! needs w"et"ergovernental or proprietary in nature; and, t"ird, owned byt"e &overnent dire!tly or t"roug" its instruentalities eit"erw"olly, or, w"ere appli!able as in t"e !ase o sto!2!orporations, to t"e e*tent o at least ity#one (=1) per!ent oits !apital sto!2.

In t"e present !ase, all t"ree (5) !orporations !oprising t"eCIIF !opanies were organiBed as sto!2

!orporations."#$phi" T"e 0C4#CIIF owns AA.1>G o t"es"ares o $%&'I OI$, 91.<AG o t"e s"ares o&-'%/O-T, and 9<.?=G o t"e s"ares o 0IT%COCO0T. 1= Obviously, t"e below =1G s"ares o sto!2 in$%&'I OI$ reoves t"is ir ro t"e deinition o agovernent owned or !ontrolled !orporation. Our !on!ern "ast"us been liited to &-'%/O-T and 0IT%COCO0T as we go ba!2 to t"e se!ond reuisite0nortunately, it is in t"is regard t"at petitioner ailed tosubstantiate "is !ontentions. T"ere is no s"owing t"a&-'%/O-T andor 0IT% COCO0T was vested wit"un!tions relating to publi! needs w"et"er governental or proprietary in nature unli2e %T-OI$ in Huipo. T"e

Court t"us !on!ludes t"at t"e CIIF !opanies are, as ound by publi! respondent, private !orporations not wit"in t"e s!ope oits 3urisdi!tion.

Eit" t"e oregoing !on!lusion, we ind it unne!essary toresolve t"e ot"er issues raised by petitioner.

' brie note on private respondentsD !"arge o oru s"opping E%ecutive Secretary v. Gordon 16 is instru!tive t"at orus"opping !onsists o iling ultiple suits involving t"e sae parties or t"e sae !ause o a!tion, eit"er siultaneously orsu!!essively, or t"e purpose o obtaining a avorable 3udgent. It is readily apparent t"at t"e present !"arge will not

prosper be!ause t"e !ause o a!tion "erein, i. e., violation oT"e 'nti#&rat and Corrupt ra!ti!es '!t, is dierent ro t"e!ause o a!tion in t"e !ase pending beore t"e trial !ourt w"i!"is !olle!tion o a su o oney plus daages.

E%-%FO-%, t"e petition is I+I%. T"e -esolutiono publi! respondent Oi!e o t"e Obudsan o 5> 8anuary199? w"i!" disissed t"e !oplaint o petitioner +anuel +$eyson 8r., as well as its Order o A 8une 199? denying "isotion or re!onsideration, is 'FFI-+%. Costs agains petitioner."#$phi"n&t

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O O-%-%.

-epubli! o t"e "ilippinesSU#REME COURT+anila

FI-T IIIO

G.R. No. 141- M%r/$ 1, 200-

COMMISSIONER OF INTERNAL REENUE, etitioner,

vs.TE #ILI##INE AMERICAN ACCI"ENTINSURANCE COM#ANY, INC., TE #ILI##INEAMERICAN ASSURANCE COM#ANY, INC., %'( TE#ILI##INE AMERICAN GENERAL INSURANCECO., INC., -espondents.

% C I I O

CAR#IO, J.

T$* C%)*

4eore t"e Court is a petition or review1 assailing t"ee!ision< o 7 8anuary <>>> o t"e Court o 'ppeals in C'#&.-. o. 56?16. T"e Court o 'ppeals aired t"ee!ision5 o = 8anuary 199= o t"e Court o Ta* 'ppeals(CT') in CT' Cases os. <=1A, <=1= and <=16. T"e CT'ordered t"e Coissioner o Internal -evenue (petitioner)to reund a total o <9,=7=.>< to respondent !opanies(respondents).

A'+*/*(*'+ F%/+)

-espondents are doesti! !orporations li!ensed to transa!tinsuran!e business in t"e !ountry. Fro 'ugust 1971 toepteber 197<, respondents paid t"e 4ureau o Internal-evenue under protest t"e 5G ta* iposed on lendinginvestors by e!tion 19=#'A o Coonwealt" '!t o. A66(C' A66), as aended by -epubli! '!t o. 611> (-'611>) and ot"er laws. C' A66 was t"e ational Internal-evenue Code (I-C) appli!able at t"e tie.

-espondents paid t"e ollowing aounts: 7,9?=.<= ro"ilippine 'eri!an (I$'+) '!!ident Insuran!e

Copany; 7,>A7.?> ro I$'+ 'ssuran!e Copany;and 1A,=A1.97 ro I$'+ &eneral Insuran!e Copany.T"ese aounts represented 5G o ea!" !opanys interestin!oe ro ortgage and ot"er loans. -espondents also paidt"e ta*es reuired o insuran!e !opanies under C' A66.

On 51 8anuary 1975, respondents sent a letter#!lai to petitioner see2ing a reund o t"e ta*es paid under protest.E"en respondents did not re!eive a response, ea!" respondentiled on <6 'pril 1975 a petition or review wit" t"e CT'.T"ese t"ree petitions, w"i!" were later !onsolidated, arguedt"at respondents were not lending investors and as su!" were

not sub3e!t to t"e 5G lending investors ta* under e!tion 19=#'.

T"e CT' ar!"ived respondents !ase or several years w"ileanot"er !ase wit" a siilar issue was pending beore t"e"ig"er !ourts. E"en respondents !ase was reinstated, t"e CT'ruled t"at respondents were entitled to t"eir reund.

T$* Rli' o +$* Cor+ o T%5 App*%l)

T"e CT' "eld t"at respondents are not ta*able as lendinginvestors be!ause t"e ter lending investors does noebra!e insuran!e !opanies. T"e CT' tra!ed t"e "istory ot"e ta* on lending investors, as ollows:

Originally, a person w"o was engaged in lendingoney at interest was ta*ed as a oney lender. Je!1A6A(*), -ev. 'd. CodeK T"e ter oney lenderswas deined as in!luding all persons w"o a2e a pra!ti!e o lending oney or t"eselves or ot"ers atinterest. Je!. 1A6=(v), id.K 0nder t"is law, aninsuran!e !opany was not !onsidered a oney

lender and was not ta*able as su!". To uote ro anold 4I- -uling:

T"e lending o oney at interest byinsuran!e !opanies !onstitutes a ne!essaryin!ident o t"eir regular business. For t"isreason, insuran!e !opanies are not liable tota* as oney lenders or real estate bro2ersor a2ing or negotiating loans se!ured byreal property. (-uling, February <?, 19<>4I- 15=.<) (T"e Internal -evenue $aw'nnotated, <nd ed., 19<9, by 4.$. +eer, page1A5)

T"e sae rule "as been applied to ban2s.

For a2ing investents on salary loans ban2s will not be reuired to pay t"e oneylenders ta* iposed by t"is subse!tion, ort"e reason t"at oney lending is !onsidereda ere in!ident o t"e ban2ing businessJee -uling o. A5, (O!tober ?, 19<6) <=O. &aB. 15<6) (T"e Internal -evenue$aw, 'nnotated, id.)

T"e ter oney lenders was later !"anged to

lending investors but t"e deinition o t"e terreains t"e sae. Je!. 1A6A(*), -ev. 'd. Code, asinally aended by Co. '!t o. <1=, and e!1A6=(v) o t"e sae Code, as inally aended by '!t o. 5965K T"e sae law is ebodied in t"e presen ational Internal -evenue Code (Co. '!t o. A66)wit"out !"ange, e*!ept in t"e aount o t"e ta*. Jeee!s. 1?<(') (5) (dd) and 19A(u), ational Internal-evenue Code.K

It is a well#settled rule t"at an adinistrativeinterpretation o a law w"i!" "as been ollowed and

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applied or a long tie, and t"ereater t"e law is re#ena!ted wit"out substantial !"ange, su!"adinistrative interpretation is deeed to "avere!eived legislative approval. In s"ort, t"eadinistrative interpretation be!oes part o t"e lawas it is presued to !arry out t"e legislative purpose.=

T"e CT' "eld t"at t"e pra!ti!e o lending oney at interest is part o t"e insuran!e business. C' A66 already ta*es t"e

insuran!e business. T"e CT' pointed out t"at t"e lawre!ogniBes and even regulates t"is pra!ti!e o lending oney by insuran!e !opanies.

T"e CT' observed t"at C' A66 also treated dierentlyinsuran!e !opanies ro lending investors in regard to i*edta*es. 0nder e!tion 1?<(')(5)(gg), insuran!e !opanieswere sub3e!t to t"e sae i*ed ta* as ban2s and inan!e!opanies. T"e CT' reasoned t"at insuran!e !opanies weregrouped wit" ban2s and inan!e !opanies be!ause t"e latterslending a!tivities were also integral to t"eir business. In!ontrast, lending investors were ta*ed at a dierent i*ed ta*under e!tion 1?<(')(5)(dd) o C' A66. T"e CT' stated t"atinsuran!e !opanies *** "ad never been reuired byrespondent JCI-K to pay t"e i*ed ta* iposed on lendinginvestors ***.6

T"e dispositive portion o t"e e!ision o = 8anuary 199= o t"e Court o Ta* 'ppeals (CT' e!ision) reads:

E%-%FO-%, preises !onsidered, petitioners"ilippine 'eri!an '!!ident Insuran!e Co.,"ilippine 'eri!an 'ssuran!e Co., and "ilippine'eri!an &eneral Insuran!e Co., In!. are not ta*ableon t"eir lending transa!tions independently o t"eir insuran!e business. '!!ordingly, respondent is

"ereby ordered to reund to petitionerJsK t"e su o 7,9?=.<=, 7,>A7.?> and 1A,=A1.97 in CT' Cases o. <=1A, <=1= and <=16, respe!tively representingt"e i*ed and per!entage ta*es w"en (si!) paid by petitioners as lending investor ro 'ugust 1971 toepteber 197<.

o pronoun!eent as to !ost.

O O-%-%.7

issatisied, petitioner elevated t"e atter to t"e Court o 'ppeals.?

T$* Rli' o +$* Cor+ o App*%l)

T"e Court o 'ppeals ruled t"at respondents are not ta*able aslending investors. In its e!ision o 7 8anuary <>>> (C'e!ision), t"e Court o 'ppeals aired t"e ruling o t"eCT', t"us:

E%-%FO-%, preises !onsidered, t"e petition isI+I%, "ereby 'FFI-+I& t"e de!ision,dated 8anuary =, 199=, o t"e Court o Ta* 'ppeals inCT' Cases os. <=1A, <=1= and <=16.

O O-%-%.9

etitioner appealed t"e C' e!ision to t"is Court.

T$* I))*)

etitioner raises t"e sole issue:

E%T%- -%O%T I0-'C%

CO+'I% '-% 048%CT TO T% 5G%-C%T'&% T'/ ' $%I& I%TO-0%- %CTIO 1?<(')(5)() ' 19=#'-%%CTI%$L I -%$'TIO TO %CTIO19A(0), '$$ OF T% I-C.1>

T$* Rli' o +$* Cor+

T"e petition la!2s erit.

On the Additional Issue Raised by Petitioner

e!tion 1?<(')(5)(dd) o C' A66 iposes an annual i5*( +%5on lending investors, depending on t"eir lo!ation.11 T"e soleuestion beore t"e CT' was w"et"er respondents weresub3e!t to t"e p*r/*'+%* +%5 on lending investors undee!tion 19=#'. etitioner raised or t"e irst tie t"e issue ot"e i*ed ta* in t"e etition or -eview 1< petitioner iled beoret"e Court o 'ppeals.

Ordinarily, a party !annot raise or t"e irst tie on appeal anissue not raised in t"e trial !ourt. 15 T"e Court o 'ppealss"ould not "ave ta2en !ogniBan!e o t"e issue on respondentssupposed liability under e!tion 1?<(')(5)(dd). owever, we!annot entirely ault t"e Court o 'ppeals or petitioner. %ven i

t"e per!entage ta* on lending investors was t"e sole issue beore it, t"e CT' ordered petitioner to reund to t"e I$'+!opanies t"e i*ed and per!entage ta*es JtK"en paid by petitioners as lending investor.1A 'lt"oug" t"e aounts orreund !onsisted only o w"at respondents paid as per!entageta*es, t"e CT' e!ision also ordered t"e reund torespondents o t"e i*ed ta* on lending investors. -espondentsin t"eir pleadings deny any liability under e!tion 1?<(')(5(dd), on t"e sae ground t"at t"ey are not lending investors.

T"e uestion o w"et"er respondents s"ould pay t"e i*ed ta*under e!tion 1?<(')(5)(dd) revolves around t"e sae issueo w"et"er respondents are ta*able as lending investors. In

siilar !ir!ustan!es, t"e Court "as "eld t"at an appellate!ourt ay !onsider an unassigned error i it is !losely relatedto an error t"at was properly assigned.1= T"is rule properlyapplies to t"e present !ase. T"us, we s"all !onsider and rule ont"e issue o w"et"er respondents are sub3e!t to t"e i*ed ta*under e!tion 1?<(')(5)(dd).

Whether Insurance Companies are

Taxable as Lendin In!estors

Invo2ing e!tions 19=#' and 1?<(')(5)(dd) in relation toe!tion 19A(u) o C' A66, petitioner argues t"at insuran!e






























!opanies are sub3e!t to two i*ed ta*es and two per!entageta*es. etitioner alleges t"at:

's a lending investor, an insuran!e !opany issub3e!t to an annual i*ed ta* o =>>.>> and anot"er =>>.>> under e!tion 1?< (')(5)(dd) and (gg) o t"eTa* Code. 's an underwriter, an insuran!e !opanyis sub3e!t to t"e 5G ta* o t"e total preius!olle!ted and anot"er 5G on t"e gross re!eipts as a

lending investor under e!tions <== and 19=#',respe!tively o t"e sae Code. ***16

etitioner also !ontends t"at t"e reund granted to respondentsis in t"e nature o a ta* e*eption, and !annot be allowedunless granted e*pli!itly and !ategori!ally.

T"e rule t"at ta* e*eptions s"ould be !onstrued stri!tlyagainst t"e ta*payer presupposes t"at t"e ta*payer is !learlysub3e!t to t"e ta* being levied against "i. 0nless a statuteiposes a ta* !learly, e*pressly and unabiguously, w"atapplies is t"e eually well#settled rule t"at t"e iposition o ata* !annot be presued.17 E"ere t"ere is doubt, ta* laws ust

be !onstrued stri!tly against t"e governent and in avor o t"e ta*payer.1? T"is is be!ause ta*es are burdens on t"eta*payer, and s"ould not be unduly iposed or presued beyond w"at t"e statutes e*pressly and !learly iport.19

e!tion 1?<(')(5)(dd) o C' A66 also provides:

e!. 1?<. Fi%ed ta%es. M (') On business ***

***

(5) Other 'i%ed ta%es. M T"e ollowing i*ed ta*ess"all be !olle!ted as ollows, t"e aount stated being

or t"e w"ole year, w"en not ot"erwise spe!iied;

***

(dd) $ending investors M

1. In !"artered !ities and irst !lassuni!ipalities, ive "undred pesos;

<. In se!ond and t"ird !lass uni!ipalities,two "undred and ity pesos;

5. In ourt" and it" !lass uni!ipalities anduni!ipal distri!ts, one "undred and twenty#ive pesos; rovided, T"at lending investorsw"o do business as su!" in ore t"an one provin!e s"all pay a ta* o ive "undred pesos.

e!tion 19=#' o C' A66 provides:

e!. 19=#'. Percentage ta% on dealers in securities(

lending investors. M ealers in se!urities and lending

investors s"all pay a ta* euivalent to t"ree pe!entu on t"eir gross in!oe.

eit"er e!tion 1?<(')(5)(dd) nor e!tion 19=#' entionsinsuran!e !opanies. e!tion 1?<(')(5)(dd) provides or t"eta*ation o lending investors in dierent lo!alities. e!tion19=#' reers to dealers in se!urities and lending investors. T"e burden is t"us on petitioner to s"ow t"at insuran!e !opaniesare lending investors or purposes o ta*ation.

In t"is !ase, petitioner does not dispute t"at respondents are int"e insuran!e business. etitioner erely alleges t"at t"edeinition o lending investors under C' A66 is broad enoug"to en!opass insuran!e !opanies. etitioner insists t"a be!ause o e!tion 19A(u), t"e two prin!ipal a!tivities o t"einsuran!e business, naely, underwriting and investent, areseparately ta*able.<>

e!tion 19A(u) o C' A66 states:

(u) $ending investor in!ludes all persons w"o a2ea pra!ti!e o lending oney or t"eselves or ot"ers

at interest.

***

's !an be seen, e!tion 19A(u) does not ta* t"e pra!ti!e olending per se. It erely deines w"at lending investors areT"e uestion is w"et"er t"e lending a!tivities o insuran!e!opanies a2e t"e lending investors or purposes ota*ation.

Ee agree wit" t"e CT' and Court o 'ppeals t"at it does notInsuran!e !opanies !annot be !onsidered lending investorsunder C' A66, as aended.

"e#inition o# Lendin

In!estors under CA $%% "oes

&ot Include Insurance

Companies.

T"e deinition in e!tion 19A(u) o C' A66 is not broadenoug" to in!lude t"e business o insuran!e !opanies. T"eInsuran!e Code o 197?<1 is very !lear on w"at !onstitutes aninsuran!e !opany. It provides t"at an insurer or insuran!e!opany s"all in!lude all individuals, partners"ipsasso!iations or !orporations *** engaged as prin!ipals in t"einsuran!e business, e*!epting utual beneit asso!iations. <

+ore spe!ii!ally, respondents all under t"e !ategory oinsuran!e !orporations as deined in e!tion 1?= o t"eInsuran!e Code, t"us:

%CTIO 1?=. Corporations ored or organiBed tosave any person or persons or ot"er !orporations"arless ro loss, daage, or liability arising roany un2nown or uture or !ontingent event, or toindeniy or to !opensate any person or persons orot"er !orporations or any su!" loss, daage, orliability, or to guarantee t"e peroran!e o o!oplian!e wit" !ontra!tual obligations or t"e



















payent o debts o ot"ers s"all be 2nown asinsuran!e !orporations.

lainly, insuran!e !opanies and lending investors aredierent enterprises in t"e eyes o t"e law. $ending investors!annot, or a !onsideration, "old anyone "arless ro loss,daage or liability, nor provide !opensation or indenityor loss. T"e underwriting o ris2s is t"e prerogative o insurers, t"e great a3ority o w"i!" are in!orporated

insuran!e !opanies

<5

li2e respondents.

Gr%'+i' o Mor+%* %'(o+$*r Lo%') %r* I'6*)+&*'+#r%/+i/*) +$%+ %r* #%r+ o +$*I')r%'/* !)i'*)).

True, respondents granted ortgage and ot"er 2inds o loans.owever, t"is was not done independently o respondentsinsuran!e business. T"e granting o !ertain loans is one o several eans o investent allowed to insuran!e !opanies. o less t"an t"e Insuran!e Code andates and regulates t"is pra!ti!e.<A

0nli2e t"e pra!ti!e o lending investors, t"e lending a!tivitieso insuran!e !opanies are !ir!us!ribed and stri!tlyregulated by t"e tate. Insuran!e !opanies !annot reely lendto t"eselves or ot"ers as lending investors !an, <= nor !aninsuran!e !opanies grant siply any 2ind o loan. %ven prior to 197?, t"e Insuran!e Code pres!ribed stri!t rules or t"egranting o loans by insuran!e !opanies.<6 T"ese provisionson ortgage, !ollateral and poli!y loans were reiterated in t"eInsuran!e Code o 197? and are still in or!e today.

etitioner !on!edes t"at respondents investent pra!ti!es areas u!" a part o t"e insuran!e business as t"e tas2 o

underwriting. evert"eless, petitioner argues t"at su!"investent pra!ti!es are separately ta*able under C' A66.

T"e CT' and t"e Court o 'ppeals ound t"at t"e investento preius and ot"er unds re!eived by respondents M t"roug" t"e granting o ortgage and ot"er loans M wasne!essary to respondents business and "en!e, s"ould not beta*ed separately.

Insuran!e !opanies are reuired by law to possess andaintain substantial legal reserves to eet t"eir obligations to poli!y"olders.<7 T"is obviously !annot be a!!oplis"edt"roug" t"e !olle!tion o preius alone, as t"e legal reserves

and !apital and surplus insuran!e !opanies are obligated toaintain run into illions o pesos. 's su!", t"e !reation o investent in!oe "as long been "eld to be generally, i notne!essarily, *))*'+i%l to t"e business o insuran!e.<?

T"e !reation o investent in!oe in t"e anner san!tioned by t"e laws on insuran!e is t"us part o t"e business o insuran!e, and t"e ruits o t"ese investents are essentiallyin!oe ro t"e insuran!e business. T"is is parti!ularly true i t"e invested assets are "eld eit"er as reserved unds to provideor poli!y obligations or as !apital and surplus to provide an

e*tra argin o saety w"i!" will be attra!tive to insuran!e buyers.<9

T"e Court "as also "eld t"at w"en a !opany is ta*ed on itsain business, it is no longer ta*able urt"er or engaging inan a!tivity or wor2 w"i!" is erely a part o, in!idental to andis ne!essary to its ain business.5> -espondents already paid per!entage and i*ed ta*es on t"eir insuran!e business. Toreuire t"e to pay per!entage and i*ed ta*es again or an

a!tivity w"i!" is ne!essarily a part o t"e sae business, t"elaw ust e*pressly reuire su!" additional payent o ta*T"ere is, "owever, no provision o law reuiring su!"additional payent o ta*.

e!tions 19=#' and 1?<(')(5)(dd) o C' A66 do not reuireinsuran!e !opanies to pay double per!entage and i*ed ta*esT"ey erely ta* lending investors, not lending a!tivities-espondents were not transored into lending investors byt"e ere a!t t"at t"ey granted loans, as t"ese investentswere part o, in!idental and ne!essary to t"eir insuran!e business.

"i*r*'+ T%5 Tr*%+&*'+ oI')r%'/* Co&p%'i*) %'(L*'(i' I'6*)+or).

e!tion 1?<(')(5) o C' A66 a!!orded dierent ta* treatentsto lending investors and insuran!e !opanies. T"e relevant portions o e!tion 1?< state:

e!. 1?<. Fi%ed ta%es ) *+, On business %%%

(5) Other 'i%ed ta%es. M T"e ollowing i*ed ta*ess"all be !olle!ted as ollows, t"e aount stated beingor t"e w"ole year, w"en not ot"erwise spe!iied;

***

(dd) L*'(i' i'6*)+or) M

1. In !"artered !ities and irst !lasuni!ipalities, ive "undred pesos;

<. In se!ond and t"ird !lass uni!ipalitiestwo "undred and ity pesos;

5. In ourt" and it" !lass uni!ipalities and

uni!ipal distri!ts, one "undred and twenty#ive pesos; rovided, T"at lending investorsw"o do business as su!" in ore t"an one provin!e s"all pay a ta* o ive "undred pesos.

***

(gg) 4an2s, insuran!e !opanies, inan!e andinvestent !opanies doing business in t"e"ilippines and ran!"ise grantees, ive "undred pesos.























*** (%p"asis supplied.)

T"e separate provisions on lending investors and insuran!e!opanies deonstrate an intention to treat t"ese businessesdierently. I Congress intended insuran!e !opanies to beta*ed as lending investors, t"ere would be no need or e!tion1?<(')(5)(gg). e!tion 1?<(')(5)(dd) would "ave beensui!ient. T"at insuran!e !opanies were in!luded wit" ban2s, inan!e and investent !opanies also supports t"e

CT's !on!lusion t"at insuran!e !opanies "ad ore in!oon wit" t"e latter enterprises t"an wit" lendinginvestors. 's t"e CT' pointed out, ban2s also regularly lendoney at interest, but are not ta*able as lending investors.

Ee ind no erit in petitioners !ontention t"at Congressintended to sub3e!t respondents to two per!entage ta*es andtwo i*ed ta*es. etitioners arguent goes against t"edo!trine o stri!t interpretation o ta* ipositions.

etitioners arguent is li2ewise not in a!!ord wit" e*isting 3urispruden!e. In Commissioner o# Internal Re!enue !.

'ichel J. Lhuillier Pa(nshop) Inc .,51 t"e Court ruled t"at t"e

dierent ta* treatent a!!orded to pawns"ops and lendinginvestors in t"e I-C o 1977 and t"e I-C o 19?6 s"owedt"e intent o Congress to deal wit" bot" sub3e!ts dierently.T"e sae reasoning applies suarely to t"e present !ase.

%ven t"e !urrent ta* law does not treat insuran!e !opanies aslending investors. 0nder e!tion 1>?(')5< o t"e I-C o 1997, lending investors and non#lie insuran!e !opanies,e*!ept or t"eir !rop insuran!es, are sub3e!t to value#added ta*('T). $ie insuran!e !opanies are e*ept ro 'T, butare sub3e!t to per!entage ta* under e!tion 1<5 o t"e I-C o 1997.

Indeed, t"e a!t t"at e!tions 19=#' and 1?<(')(5)(dd) o C'A66 ailed to ention insuran!e !opanies already iplies t"elatters e*!lusion ro t"e !overage o t"ese provisions. E"ena statute enuerates t"e t"ings upon w"i!" it is to operate,everyt"ing else by ipli!ation ust be e*!luded ro itsoperation and ee!t.55

"*i'i+io' o L*'(i'I'6*)+or) i' CA 4 i) No+N*.

etitioner does not dispute t"at it issued a ruling in 19<> to t"eee!t t"at t"e lending o oney at interest was a ne!essary

in!ident o t"e insuran!e business, and t"at insuran!e!opanies were t"us not sub3e!t to t"e ta* on oney lenders.etitioner argues only t"at t"e 19<> ruling does not apply tot"e instant !ase be!ause -' 611> introdu!ed t"e deinition o lending investors to C' A66 only in 1969.

T"e sub3e!t deinition was a!tually introdu!ed u!" earlier, ata tie w"en lending investors were still reerred to as oneylenders. e!tions A= and A6 o t"e Internal -evenue $aw o 191A5A (191A Ta* Code) state:

%CTIO A=. 'ount o Ta* on 4usiness. @ Fi*edta*es on business s"all be !olle!ted as ollows, t"eaount stated being or t"e w"ole year, w"en notot"erwise spe!iied:

***

(*) +oney lenders, eig"ty pesos;

***

%CTIO A6. Eords and "rases eined. @ Inapplying t"e provisions o t"e pre!eding se!tionwords and p"rases s"all be ta2en in t"e sense ande*tension indi!ated below:

***

8Mo'* l*'(*r8 in!ludes %ll p*r)o') $o &%:* %pr%/+i/* o l*'(i' &o'* or +$*&)*l6*) or o+$*r)%+ i'+*r*)+. (%p"asis supplied)

's !an be seen, t"e deinitions o oney lender under t"e191A Ta* Code and lending investor under C' A66 areidenti!al. T"e ter oney lender was erely !"anged tolending investor w"en '!t o. 5965 aended t"e -evised'dinistrative Code in 195<.5= T"is sae deinition olending investor "as sin!e appeared in e!tion 19A(u) o C'A66 and later ta* laws.

ote t"at insuran!e !opanies were not in!luded aong t"e businesses sub3e!t to an annual i*ed ta* under t"e 191A Ta*Code.56 T"at Congress later saw t"e need to introdu!e e!tion1?<(')(5)(gg) in C' A66 bolsters our view t"at t"ere was nolegislative intent to ta* insuran!e !opanies as lendinginvestors. I insuran!e !opanies were already ta*ed aslending investors, t"ere would "ave been no need or aseparate provision spe!ii!ally reuiring insuran!e !opaniesto pay i*ed ta*es.

T$* Cor+ A//or() Gr*%+;*i$+ +o +$* F%/+%l Fi'(i')o +$* CTA.

edi!ated e*!lusively to t"e study and !onsideration o ta* probles, t"e CT' "as ne!essarily developed an e*pertise int"e sub3e!t o ta*ation t"at t"is Court "as re!ogniBed tie and

again. For t"is reason, t"e indings o a!t o t"e CT' parti!ularly w"en aired by t"e Court o 'ppeals, aregenerally !on!lusive on t"is Court absent grave abuse odis!retion or palpable error ,57 w"i!" are not present in t"is!ase.

;EREFORE, we %L t"e instant petition and 'FFI-+t"e e!ision o 7 8anuary <>>> o t"e Court o 'ppeals in C'#&.-. o. 56?16.

SO OR"ERE".

http://www.lawphil.net/judjuris/juri2003/jul2003/gr_150947_2003.html





























% 4'C

G.R. No. 3-7 M%r/$ 1, 199

TE #RESI"ENTIAL ANTI<"OLLAR SALTING TAS=

FORCE, petitioner,vs.ONORA!LE COURT OF A##EALS, ONORA!LETEOFILO L, GUA"I>, JR.,#r*)i(i' J(*, REGIONALTRIAL COURT, !r%'/$ 147 NCR ?MA=ATI@, %'(=ARAMFIL IM#ORT<E#ORT CO., INC., respondents.

- . Faylona / +ssociates 'or respondents

SARMIENTO, J.:

T"e petitioner, t"e residential 'nti#ollar alting Tas2 For!e,t"e residentDs ar assigned to investigate and prose!ute so#!alled dollar salting a!tivities in t"e !ountry (per residential e!ree o. 1956 as aended by residentiale!ree o. <>><), as2s t"e Court to "old as null and void two-esolutions o t"e Court o 'ppeals, dated epteber <A,19?7 1 and +ay <>, 19??, 2 reversing its e!ision, datedO!tober <A, 19?6. 3 T"e e!ision set aside an Order, dated'pril 16, 19?=, o t"e -egional Trial Court, 4 as well as itsOrder, dated 'ugust <1, 19?=. T"e -esolution, datedepteber <A, 19?7 disposed o, and granted, t"e privaterespondent Narail Iport#%*port Co., In!.Ds otion or re!onsideration o t"e O!tober <A, 19?6 e!ision; t"e

-esolution dated +ay <>, 19??, in turn, denied t"e petitionerDsown otion or re!onsideration.

T"e a!ts are not in !ontroversy. Ee uote:

On +ar!" 1<, 19?=, tate rose!utor 8ose 4.-osales, w"o is assigned wit" t"eresidential 'nti#ollar alting Tas2 For!e"ereinater reerred to as ' Tas2 For!eor purposes o !onvenien!e, issued sear!"warrants os. 1=6, 1=7, 1=?, 1=9, 16> and161 against t"e petitioners Narail Iport#%*port Co., In!., 4 %nterprises Co.,In!., "ilippine eterans Corporation,"ilippine eterans evelopentCorporation, "ilippine Constru!tionevelopent Corporation, "ilippine $auanIndustries Corporation, Inter#tradeevelopent ('lvin 'uino), 'elili 0.+alauio2 %nterprises and 8aie . $u!an%nterprises.

T"e appli!ation or t"e issuan!e o said sear!" warrants wasiled by 'tty. apoleon &ataytan o t"e 4ureau o Custosw"o is a deputiBed eber o t"e ' Tas2 For!e. 'tta!"ed

to t"e said appli!ation is t"e aidavit o 8osein +. Castro w"ois an operative and investigator o t"e ' Tas2 For!e. aid8osein +. Castro is li2ewise t"e sole deponent in t"e purported deposition to support t"e appli!ation or t"eissuan!e o t"e si* (6) sear!" warrants involved in t"is !aseT"e appli!ation iled by 'tty. &ataytan, t"e aidavit anddeposition o 8osein +. Castro are all dated +ar!" 1<, 19?=-

"ortly t"ereater, t"e private respondent (t"e petitione below) went to t"e -egional Trial Court on a petition to en3oint"e ipleentation o t"e sear!" warrants in uestion. On+ar!" 15, 19?=, t"e trial !ourt issued a teporary restrainingorder Jee!tive or a period o ive (=) days noti!e 7 K andset t"e !ase or "earing on +ar!" 1?, 19?=.

In disposing o t"e petition, t"e said !ourt ound t"e aterialissues to be:

1) Copeten!y o t"is Court to a!t on petition iled by t"e petitioners;

<) alidity o t"e sear!" warrants issued byrespondent tate rose!utor;

5) E"et"er or not t"e petition "as be!oeoot and a!adei! be!ause all t"e sear!"warrants soug"t to be uas"ed "ad already been ipleented and e*e!uted.

On 'pril 16, 19?=, t"e lower !ourt issued t"e irst o its!"allenged Orders, and "eld:

E%-%FO-%, in view o all t"e oregoingt"e Court "ereby de!lares ear!" Earran

os. 1=6, 1=7, 1=?, 1=9, 16>, and 161 to benull and void. '!!ordingly, t"e respondentsare "ereby ordered to return and surrenderiediately all t"e personal properties anddo!uents seiBed by t"e ro t"e petitioners by virtue o t"e aoreentionedsear!" warrants.

O O-%-%. 9

On 'ugust <1, 19?=, t"e trial !ourt denied re!onsideration.

On 'pril A, 19?6, t"e residential 'nti#ollar alting Tas2For!e went to t"e respondent Court o 'ppeals to !ontest, on!ertiorari, t"e twin Order(s) o t"e lower !ourt.

In ruling initially or t"e Tas2 For!e, t"e 'ppellate Court "eld:

erein petitioner is a spe!ial uasi#3udi!ia body wit" e*press powers enuerated under 1956 to prose!ute oreign e*!"angeviolations deined and punis"ed under . o. 1??5.



T"e petitioner, in e*er!ising its uasi# 3udi!ial powers, ran2s wit" t"e -egionalTrial Courts, and t"e latter in t"e !ase at bar "ad no 3urisdi!tion to de!lare t"e sear!"warrants in uestion null and void.

4esides as !orre!tly pointed out by t"e'ssistant oli!itor &eneral t"e de!ision o t"e residential 'nti#ollar alting Tas2

For!e is appealable to t"e Oi!e o t"eresident.10

On oveber 1<, 19?6, Narail Iport#%*port Co., In!.soug"t a re!onsideration, on t"e uestion priarily o w"et"er or not t"e residential 'nti#ollar alting Tas2 For!e is su!"ot"er responsible oi!erD !ountenan!ed by t"e 1975Constitution to issue warrants o sear!" and seiBure.

's we "ave indi!ated, t"e Court o 'ppeals, on NarailDsotion, reversed itsel and issued its -esolution, datedepteber 19?7, and subseuently, its -esolution, dated +ay<>, 19??, denying t"e petitionerDs otion or re!onsideration.

In its petition to t"is Court, t"e petitioner alleges t"at in soissuing t"e -esolution(s) above#entioned, t"e respondentCourt o 'ppeals !oitted grave abuse o dis!retion andor a!ted in e*!ess o its appellate 3urisdi!tion, 11 spe!ii!ally:

a) In deviating ro t"e settled poli!y andrulings o t"e upree Court t"at no-egional Trial Courts ay !ounterand or restrain t"e enor!eent o lawul writs or de!rees issued by a uasi#3udi!ial body o eual and !oordinate ran2, li2e t"e 'Tas2 For!e;

b) For resorting to 3udi!ial legislation toarrive at its erroneous basis or re!onsidering its previous e!ision datedO!tober <A, 19?6 (see 'nne* I) and t"us proulgated t"e uestioned -esolutions('nne*es ' and 4), w"i!" violated t"e!onstitutional do!trine on separation o powers;

!) In not resolving dire!tly t"e ot"er iportant issues raised by t"e petitioner inits etition in C'#&.-. o. >?6<<#

despite t"e a!t t"at petitioner "asdeonstrated sui!iently and !onvin!inglyt"at respondent -TC, in issuing t"euestioned Orders in pe!ial ro!eeding o.+#6<A (see 'nne*es C and D),!oitted grave abuse o dis!retion andor a!ted in e*!ess o 3urisdi!tion:

1. In ruling t"at (a) t"e des!ription o t"et"ings to be seiBed as stated in t"e !ontestedsear!" warrant were too general w"i!"allegedly render t"e sear!" warrants null and

void; (b) t"e appli!ations or t"e !ontestedsear!" warrants a!tually !"arged twooenses in !ontravention o t"e <nd paragrap", e!tion 5, -ule 1<6 o t"e -uleso Court; and (!) t"is !ase "as not be!oeoot and a!adei!, even i t"e !ontestedsear!" warrants "ad already been ullyipleented wit" positive results; and

<. In ruling t"at t"e petitioner ' Tas2For!e "as not been granted under 1956D3udi!ial or uasi#3udi!ial 3urisdi!tion. 12

Ee ind, upon t"e oregoing a!ts, t"at t"e essential uestionst"at !onront us are# (i) is t"e residential 'nti#ollar altingTas2 For!e a uasi#3udi!ial body, and one !o#eual in ran2 andstanding wit" t"e -egional Trial Court, and a!!ordingly beyond t"e latterDs 3urisdi!tion; and (ii) ay t"e said presidential body be said to be su!" ot"er responsible oi!eras ay be aut"oriBed by law to issue sear!" warrants undert"e 1975 Constitution uestions we ta2e up seriatim.BB

In subitting t"at it is a uasi#3udi!ial entity, t"e petitionerstates t"at it is endowed wit" e*press powers and un!tionsunder o. 1956, to prose!ute oreign e*!"ange violationsas deined and punis"ed under o. 1??5. 13 4y t"e verynature o its e*press powers as !onerred by t"e laws, so it is!ontended, w"i!" are de!idedly uasi#3udi!ial odis!retionary un!tion, su!" as to !ondu!t preliinaryinvestigation on t"e !"arges o oreign e*!"ange violationsissue sear!" warrants or warrants o arrest, "old departureorders, aong ot"ers, and depending upon t"e eviden!e presented, to disiss t"e !"arges or to ile t"e !orrespondinginoration in !ourt o %*e!utive Order o. 95A, o. 1956and its Ipleenting -ules and -egulations ee!tive 'ugust<6, 19?A), petitioner e*er!ises uasi#3udi!ial power or t"e power o ad3udi!ation . 14

T"e Court o 'ppeals, in its -esolution now assailed, 1- waso t"e opinion t"at JtK"e grant o uasi#3udi!ial powers to petitioner did not diinis" t"e regular !ourtsD 3udi!ial power ointerpretation. T"e rig"t to interpret a law and, i ne!essary tode!lare one un!onstitutional, e*!lusively pertains to t"e 3udi!iary. In assuing t"is un!tion, !ourts do not pro!eed ont"e t"eory t"at t"e 3udi!iary is superior to t"e two ot"er!oordinate bran!"es o t"e governent, but solely on t"et"eory t"at t"ey are reuired to de!lare t"e law in every !asew"i!" !oe beore t"e. 1

T"is Court inds t"e 'ppellate Court to be in error, sin!e w"att"e petitioner puts to uestion is t"e -egional Trial CourtDs a!to assuing 3urisdi!tion over t"e private respondentDs petition below and its subseuent !ounterand o t"e residentia'nti#ollar alting Tas2 For!eDs orders o sear!" and seiBure,or t"e reason t"at t"e presidential body, as an entity(allegedly) !oordinate and !o#eual wit" t"e -egional TrialCourt, was (is) not vested wit" su!" a 3urisdi!tion. 'ne*aination o t"e residential 'nti#ollar alting Tas2For!eDs petition s"ows indeed its re!ognition o 3udi!ial review(o t"e a!ts o &overnent) as a basi! privilege o t"e !ourtsIts ob3e!tion, pre!isely, is w"et"er it is t"e -egional Tria



Court, or t"e superior !ourts, t"at ay underta2e su!" areview.

0nder t"e 8udi!iary -eorganiBation '!t o 19?>, 17 t"e Courto 'ppeals e*er!ises:

(5) %*!lusive appellate 3urisdi!tion over allinal 3udgents, de!isions, resolutions,orders or awards o -egional Trial Court and

uasi#3udi!ial agen!ies, instruentalities, boards or !oissions, e*!ept t"ose allingwit"in t"e appellate 3urisdi!tion o t"eupree Court in a!!ordan!e wit" t"eConstitution, t"e provisions o t"is '!t, ando subparagrap" (1) o t"e t"ird paragrap"and subparagrap" (A) o t"e ourt" paragrap"o e!tion 17 o t"e 8udi!iary '!t o 19A?.1

*** *** ***

0nder t"e present Constitution, wit" respe!t to its provisions

on Constitutional Coissions, it is provided, in part t"at:

... 0nless ot"erwise provided by t"isConstitution or by law, any de!ision, order,or ruling o ea!" Coission ay be broug"t to t"e upree Court on !ertiorari by t"e aggrieved party wit"in t"irty daysro re!eipt o a !opy t"ereo. 19

On t"e ot"er "and, -egional Trial Courts "ave e*!lusiveoriginal 3urisdi!tion:

(6) In all !ases not wit"in t"e e*!lusive

3urisdi!tion o any !ourt, tribunal, person or body e*er!ising 3udi!ial or uasi#3udi!ialun!tions. 20

*** *** ***

$i2ewise:

... T"e upree Court ay designate !ertain bran!"es o t"e -egional Trial Court to"andle e*!lusively !riinal !ases, 3uvenileand doesti! relations !ases, agrarian !ase,

urban land reor !ases w"i!" do not allunder t"e 3urisdi!tion o uasi# 3udi!ial bodies and agen!ies andor su!" ot"er spe!ial !ases as t"e upree Court aydeterine in t"e interest o a speedy andei!ient adinistration o 3usti!e. 21

*** *** ***

0nder our -esolution dated 8anuary 11, 19?5: 22

... T"e appeals to t"e Interediate 'ppellateCourt Jnow, Court o 'ppealsK ro uasi 3udi!ial bodies s"all !ontinue to be governed by t"e provisions o -epubli! '!t o. =A5Ainsoar as t"e sae is not in!onsistent wit"t"e provisions o 4.. 4lg. 1<9. 23

T"e pertinent provisions o -epubli! '!t o. =A5A are asollows:

%CTIO 1. 'ppeals ro spe!iiedagen!ies.@ 'ny provision o e*isting law or-ule o Court to t"e !ontrarynotwit"standing, parties aggrieved by a inaruling, award, order, de!ision, or 3udgeno t"e Court o 'grarian -elations; t"ee!retary o $abor under e!tion 7 o-epubli! '!t ubered i* "undred andtwo, also 2nown as t"e +iniu Eage$aw; t"e epartent o $abor undere!tion <5 o -epubli! '!t ubered %ig"t"undred seventy#ive, also 2nown as t"eIndustrial ea!e '!t; t"e $and-egistration Coission; t"e e!urities and%*!"ange Coission; t"e o!ial e!urityCoission; t"e Civil 'eronauti!s 4oardt"e atent Oi!e and t"e 'gri!ulturaInventions 4oard, ay appeal t"erero tot"e Court o 'ppeals, wit"in t"e period andin t"e anner "erein provided, w"et"er t"eappeal involves uestions o a!t, i*eduestions o a!t and law, or uestions olaw, or all t"ree 2inds o uestions. Froinal 3udgents or de!isions o t"e Court o'ppeals, t"e aggrieved party ay appeal bycertiorari to t"e upree Court as provided

in -ule A= o t"e -ules o Court. 24

4e!ause o subseuent aendents, in!luding t"e abolition ovarious spe!ial !ourts, 2- 3urisdi!tion over uasi#3udi!ia bodies "as to be, !onseuently, deterined by t"e!orresponding aendatory statutes. 0nder t"e $abor Codede!isions and awards o t"e ational $abor -elationCoission are inal and e*e!utory, but, nevert"elessDreviewable by t"is Court t"roug" a petition or !ertiorari andnot by way o appeal. 2

0nder t"e roperty -egistration e!ree, de!isions o t"eCoission o $and -egistration, en !onsults, are appealableto t"e Court o 'ppeals. 27

T"e de!isions o t"e e!urities and %*!"ange Coission areli2ewise appealable to t"e 'ppellate Court, 2 and so arede!isions o t"e o!ial e!urity Coission.29

's a rule, w"ere legislation provides or an appeal rode!isions o !ertain adinistrative bodies to t"e Court o'ppeals, it eans t"at su!" bodies are !o#eual wit" t"e-egional Trial Courts, in ters o ran2 and stature, andlogi!ally, beyond t"e !ontrol o t"e latter.



!onstituting bla!2ar2eting or saltingabroad o oreign e*!"ange, provided said person voluntarily adits t"e a!ts and!ir!ustan!es !onstituting t"e oense and presents proo t"at t"e oreign e*!"angeretained abroad "as already been broug"tinto t"e !ountry.

T"ereater, no urt"er !ivil or !riinal a!tion

ay be instituted against said person beoreany ot"er 3udi!ial regulatory or adinistrative body or violation o residential e!ree o. 1??5.

T"e aount o t"e ine s"all be deterined by t"e C"airan o t"e residential 'nti#ollar alting Tas2 For!e and paid in esosta2ing into !onsideration t"e aount o oreign e*!"ange retained abroad, t"ee*!"ange rate dierentials, un!olle!tedta*es and duties t"ereon, unde!lared proits,interest rates and su!" ot"er relevant a!tors.

T"e ine s"all be paid to t"e Tas2 For!ew"i!" s"all retain Twenty per!ent (<> G)t"ereo. T"e inorer, i any, s"all beentitled to Twenty per!ent (<> G) o t"eine. "ould t"ere be no inorer, t"e Tas2 For!e s"all be entitle to retain Forty per!ent(A> G) o t"e ine and t"e balan!e s"alla!!rue to t"e general unds o t"e ationalgovernent. T"e aount o t"e ine to beretained by t"e Tas2 For!e s"all or part o its Conidential Fund and be utiliBed or t"eoperations o t"e Tas2 For!e . 33

T"e Court sees not"ing in t"e aoreuoted provisions (e*!eptwit" respe!t to t"e Tas2 For!eDs powers to issue sear!"warrants) t"at will reveal a legislative intendent to !oner itwit" uasi#3udi!ial responsibilities relative to oenses punis"ed by residential e!ree o. 1??5. Its underta2ing, aswe said, is siply, to deterine w"et"er or not probable !ausee*ists to warrant t"e iling o !"arges wit" t"e proper !ourt,eaning to say, to !ondu!t an inuiry preliinary to a 3udi!ialre!ourse, and to re!oend a!tion o appropriateaut"orities. It is not unli2e a is!alDs oi!e t"at !ondu!ts a preliinary investigation to deterine w"et"er or not priaa!ie eviden!e e*ists to 3ustiy "aling t"e respondent to !ourt,and yet, w"ile it a2es t"at deterination, it !annot be said to be a!ting as a uasi#!ourt. For it is t"e !ourts, ultiately, t"at pass 3udgent on t"e a!!used, not t"e is!al.

It is not unli2e t"e residential Coission on &ood&overnent eit"er, t"e e*e!utive body appointed toinvestigate and prose!ute !ases involving ill#gotten wealt".It "ad been vested wit" enorous powers, li2e t"e issuan!e o writs o seuestration, reeBe orders, and siilar pro!esses, butt"at did not, on a!!ount t"ereo alone, a2e it a uasi#3udi!ialentity as deined by re!ogniBed aut"orities. It !annot pronoun!e 3udgeent o t"e a!!usedDs !ulpability, t"e

3urisdi!tion to do w"i!" is e*!lusive upon t"e andiganbayan34

I t"e residential 'nti#ollar alting Tas2 For!e is not"en!e, a uasi#3udi!ial body, it !annot be said to be !o#eual or!oordinate wit" t"e -egional Trial Court. T"ere is not"ing inits enabling statutes t"at would deonstrate its standing at parwit" t"e said !ourt.

In t"at respe!t, we do not ind error in t"e respondent Court o'ppealDs resolution sustaining t"e assuption o 3urisdi!tion by t"e !ourt a 0uo.

It will not do to say t"at t"e a!t t"at t"e residential Tas2For!e "as been epowered to issue warrants o arrest, sear!",and seiBure, a2es it, ergo, a sei#!ourt. re!isely, it is t"eob3e!tion interposed by t"e private respondent, w"et"er or notit !an under t"e 1975 C"arter, issue su!" 2inds o pro!esses.

It ust be observed t"at under t"e present Constitution, t"e powers o arrest and sear!" are e*!lusive upon 3udges. 3- Tot"at e*tent, t"e !ase "as be!oe oot and a!adei!

evert"eless, sin!e t"e uestion "as been spe!ii!ally put tot"e Court, we ind it unavoidable to resolve it as t"e inaarbiter o legal !ontroversies, pursuant to t"e provisions o t"e1975 Constitution during w"ose regie t"e !ase was!oen!ed.

in!e t"e 1975 Constitution too2 or!e and ee!t and until itwas so un!ereoniously dis!arded in 19?6, its provision!onerring t"e power to issue arrest and sear!" warrants uponan oi!er, ot"er t"an a 3udge, by iat o legislation "ave beenat best !ontroversial. In 1im v Ponce de 1eon, 3 a 197=de!ision, t"is Court ruled t"at a is!al "as no aut"ority to issuesear!" warrants, but "eld in t"e sae vein t"at, by virtue o t"e

responsible oi!er !lause o t"e 1975 4ill o -ig"ts, anylawul oi!er aut"oriBed by law !an issue a sear!" warrant orwarrant o arrest.37 'ut"orities, "owever, "ave !ontinued toe*press reservations w"et"er or not is!als ay, by statute, begiven su!" a power. 3

$ess t"an a year later, we proulgated Collector o' Customs v

.illalu2 , 39 in w"i!" we !ategori!ally averred: 0ntil now onlyt"e 3udge !an issue t"e warrant o arrest. 40 o law or presidential de!ree "as been ena!ted or proulgated vestingt"e sae aut"ority in a parti!ular responsible oi!er . 41

'pparently, illaluB "ad settled t"e debate, but t"e sae

uestion persisted ollowing t"is Courts subseuent rulingsup"olding t"e residentDs alleged eergen!y arrest powers .42J+r. 8usti!e ugo &utierreB would "old, "owever, t"at aresidential Coitent Order (CO) is (was) not a spe!ieso arrest in its te!"ni!al sense, and t"at t"e (deposed) C"ie%*e!utive, in issuing one, does not do so in "is !apa!ity as aresponsible oi!er under t"e 1975 C"arter, but rat"er, asCoander#in#C"ie o t"e 'red For!es in ties oeergen!y, or in order to !arry out t"e deportation oundesirable aliens.43 In t"e distinguis"ed 8usti!eDs opiniont"en, t"ese are a!ts t"at !an be done wit"out need o 3udi!ialintervention be!ause t"ey are not, pre!isely, 3udi!ial buresidential a!tions.K



In Ponsica v Ignalaga,44 "owever, we "eld t"at t"e ayor "as been ade a responsible oi!erD by t"e $o!al &overnentCode, 4- but "ad !eased to be one wit" t"e approval o t"e19?7 Constitution a!!ording 3udges sole aut"ority to issuearrest and sear!" warrants. 4ut in t"e sae breat", we did notrule t"e grant under t"e Code un!onstitutional based on t"e provisions o t"e orer Constitution. Ee were agreed,t"oug", t"at t"e responsible oi!er reerred to by t"eundaental law s"ould be one !apable o appro*iating t"e!old neutrality o an ipartial 3udge. 4

In stri2ing down residential e!ree o. 1956 t"e respondentCourt relied on 'eri!an 3urispruden!e, notably, -at2 v3nited States, 47 4ohnson v 3nited States, 4 and Coolidge v

5e$ 6ampshire 49 in w"i!" t"e 'eri!an upree Courtruled t"at prose!utors (li2e t"e petitioner) !annot be givensu!" powers be!ause o t"eir in!apa!ity or a deta!"eds!rutiny -0 o t"e !ases beore t"e. Ee air t"e 'ppellateCourt.

Ee agree t"at t"e residential 'nti#ollar alting Tas2 For!ee*er!ises, or was eant to e*er!ise, prose!utorial powers, andon t"at ground, it !annot be said to be a neutral and deta!"ed3udge to deterine t"e e*isten!e o probable !ause or purposes o arrest or sear!". 0nli2e a agistrate, a prose!utor is naturally interested in t"e su!!ess o "is !ase. 'lt"oug" "isoi!e is to see t"at 3usti!e is done and not ne!essarily tose!ure t"e !onvi!tion o t"e person a!!used, -1 "e stands,invariably, as t"e a!!usedDs adversary and "is a!!user. To perit "i to issue sear!" warrants and indeed, warrants o arrest, is to a2e "i bot" 3udge and 3ury in "is own rig"t,w"en "e is neit"er. T"at a2es, to our ind and to t"at e*tent,residential e!ree o. 1956 as aended by residentiale!ree o. <>><, un!onstitutional.

It is our ruling, t"us, t"at w"en t"e 1975 Constitution spo2e o responsible oi!er to w"o t"e aut"ority to issue arrest andsear!" warrants ay be delegated by legislation, it did noturnis" t"e legislator wit" t"e li!ense to give t"at aut"ority tow"osoever it pleased. It is to be noted t"at t"e C"arter itsel a2es t"e ualii!ation t"at t"e oi!er "isel ust beresponsible. Ee are not saying, o !ourse, t"at t"eresidential 'nti#ollar alting Tas2 For!e (or any siilar prose!utor) is or "as been irresponsible in dis!"arging its duty.-at"er, we ta2e responsibility, as used by t"e Constitution,to ean not only s2ill and !opeten!e but ore signii!antly,neutrality and independen!e !oparable to t"e ipartiality presued o a 3udi!ial oi!er. ' prose!utor !an in no anner be said to be possessed o t"e latter ualities.

'!!ording to t"e Court o 'ppeals, t"e iplied e*!lusion o prose!utors under t"e 1975 Constitution was ounded on t"ereuireents o due pro!ess, notably, t"e assuran!e to t"erespondent o an unbiased inuiry o t"e !"arges against "i prior to t"e arrest o "is person or seiBure o "is property. Eeadd t"at t"e e*!lusion is also deanded by t"e prin!iple o separation o powers on w"i!" our republi!an stru!ture rests.rose!utors e*er!ise essentially an e*e!utive un!tion (t"e petitioner itsel is !"aired by t"e +inister, now e!retary, o Trade and Industry), sin!e under t"e Constitution, t"eresident "as pledged to e*e!ute t"e laws. -2 's su!", t"ey

!annot be ade to issue 3udi!ial pro!esses wit"out unlawullyipinging t"e prerogative o t"e !ourts.

't any rate, Ponsica v Ignalaga s"ould ore!lose all uestionson t"e atter, alt"oug" t"e Court "opes t"at t"is disposition"as !lariied a !ontroversy t"at "ad generated oten bittedebates and bi!2erings.

T"e Court 3oins t"e &overnent in its !apaign against t"e

s!ourge o dollar# salting, a perni!ious pra!ti!e t"at "assubstantially drained t"e nationDs !oers and "as seriouslyt"reatened its e!onoy. Ee re!ogniBe t"e ena!e it "as posed(and !ontinues to pose) unto t"e very stability o t"e !ountryt"e urgen!y or toug" easures designed to !ontain i noeradi!ate it, and oreost, t"e need or !ooperation ro t"e!itiBenry in an all#out !apaign. 4ut w"ile we support t"etateDs eorts, we do so not at t"e e*pense o undaentarig"ts and liberties and !onstitutional saeguards againsarbitrary and unreasonable a!ts o &overnent. I in t"e event"at as a result o t"is ruling, we prove to be an obsta!le tot"e vital endeavour o staping out t"e bla!2ar2eting ovaluable oreign e*!"ange, we do not relis" it and !ertainly, donot ean it. T"e Constitution siply does not leave us u!"!"oi!e.

E%-%FO-%, t"e petition is I+I%. o !osts. OO-%-%.


G.R. No. 17139 M% 3, 200

#ROF. RAN"OLF S. "AI", LOREN>O TAA"A III

RONAL" LLAMAS, . ARRY L. RODUE, JR., JOELRUI> !UTUYAN, ROGER R. RAYEL, GARY SMALLARI, ROMEL REGALA"O !AGARESCRISTO#ER F.C. !OLASTIG, etitioners,vs.GLORIA MACA#AGAL<ARROYO, AS #RESI"ENTAN" COMMAN"ER<IN<CIEF, EECUTIESECRETARY E"UAR"O ERMITA, ON. AELINOCRU> II, SECRETARY OF NATIONAL "EFENSEGENERAL GENEROSO SENGA, CIEF OF STAFFARME" FORCES OF TE #ILI##INES, "IRECTORGENERAL ARTURO LOMI!AO, CIEF, #ILI##INENATIONAL #OLICE, -espondents.

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G.R. No. 171409 M% 3, 200

NIE> CACO<OLIARES AN" TRI!UNE#U!LISING CO., INC., etitioners,vs.ONORA!LE SECRETARY E"UAR"O ERMITA AN"ONORA!LE "IRECTOR GENERAL ARTURO CLOMI!AO, -espondents.



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G.R. No. 1714- M% 3, 200

FRANCIS JOSE# G. ESCU"ERO, JOSE# A.SANTIAGO, TEO"ORO A. CASINO, AGA#ITO A.ADUINO, MARIO J. AGUJA, SATUR C. OCAM#O,MUJI S. ATAMAN, JUAN E"GAR"O ANGARA,TEOFISTO "L. GUINGONA III, EMMANUEL JOSEL J.

ILLANUEA, LI>A L. MA>A, IMEE R. MARCOS,RENATO !. MAGTU!O, JUSTIN MARC S!. CI#ECO,ROILO GOLE>, "ARLENE ANTONINO<CUSTO"IO,LORETTA ANN #. ROSALES, JOSEL G. IRA"OR,RAFAEL . MARIANO, GIL!ERT C. REMULLA,FLORENCIO G. NOEL, ANA TERESIAONTIEROS<!ARADUEL, IMEL"A C. NICOLAS,MARIC M..F. LEONEN, NERI JAIER COLMENARES, MOEMENT OF CONCERNE"CITI>ENS FOR CIIL LI!ERTIES RE#RESENTE" !YAMA"O GAT INCIONG, etitioners,vs.E"UAR"O R. ERMITA, EECUTIE SECRETARY,AELINO J. CRU>, JR., SECRETARY, "N" RONAL"O. #UNO, SECRETARY, "ILG, GENEROSO SENGA,AF# CIEF OF STAFF, ARTURO LOMI!AO, CIEF#N#, -espondents.

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G.R. No. 17143 M% 3, 200

=ILUSANG MAYO UNO, RE#RESENTE" !Y ITSCAIR#ERSON ELMER C. LA!OG AN" SECRETARYGENERAL JOEL MAGLUNSO", NATIONALFE"ERATION OF LA!OR UNIONS =ILUSANG

MAYO UNO ?NAFLU<=MU@, RE#RESENTE" !Y ITSNATIONAL #RESI"ENT, JOSELITO . USTARE>,ANTONIO C. #ASCUAL, SALA"OR T. CARRAN>A,EMILIA #. "A#ULANG, MARTIN CUSTO"IO, JR.,AN" RODUE M. TAN, etitioners,vs.ER ECELLENCY, #RESI"ENT GLORIAMACA#AGAL<ARROYO, TE ONORA!LEEECUTIE SECRETARY, E"UAR"O ERMITA, TECIEF OF STAFF, ARME" FORCES OF TE#ILI##INES, GENEROSO SENGA, AN" TE #N#"IRECTOR GENERAL, ARTURO LOMI!AO,-espondents.

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G.R. No. 171400 M% 3, 200

ALTERNATIE LA; GROU#S, INC. ?ALG@, etitioner,vs.EECUTIE SECRETARY E"UAR"O R. ERMITA, LT.GEN. GENEROSO SENGA, AN" "IRECTOR GENERAL ARTURO LOMI!AO, -espondents.

G.R. No. 17149 M% 3, 200

JOSE ANSELMO I. CA"I>, FELICIANO M!AUTISTA, ROMULO R. RIERA, JOSE AMOR MAMORA"O, ALICIA A. RISOS<I"AL, FELIMON CA!ELITA III, MANUEL #. LEGAS#I, J.!. JOY C!ERNA!E, !ERNAR" L. "AGCUTA, ROGELIO GARCIA AN" INTEGRATE" !AR OF TE#ILI##INES ?I!#@, etitioners,vs.ON. EECUTIE SECRETARY E"UAR"O ERMITAGENERAL GENEROSO SENGA, IN IS CA#ACITY ASAF# CIEF OF STAFF, AN" "IRECTOR GENERALARTURO LOMI!AO, IN IS CA#ACITY AS #N#CIEF, -espondents.

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G.R. No. 171424 M% 3, 200

LOREN !. LEGAR"A, etitioner,vs.GLORIA MACA#AGAL<ARROYO, IN ER CA#ACITYAS #RESI"ENT AN" COMMAN"ER<IN<CIEF

ARTURO LOMI!AO, IN IS CA#ACITY AS"IRECTOR<GENERAL OF TE #ILI##INENATIONAL #OLICE ?#N#@ GENEROSO SENGA, INIS CA#ACITY AS CIEF OF STAFF OF TE ARME"FORCES OF TE #ILI##INES ?AF#@ AN"E"UAR"O ERMITA, IN IS CA#ACITY ASEECUTIE SECRETARY, -espondents.

% C I I O

SAN"OAL<GUTIERRE>, J.

'll powers need soe restraint; pra!ti!al ad3ustents rat"er

t"an rigid orula are ne!essary.1 uperior strengt" M t"e useo or!e M !annot a2e wrongs into rig"ts. In t"is regard, t"e!ourts s"ould be vigilant in saeguarding t"e !onstitutionalrig"ts o t"e !itiBens, spe!ii!ally t"eir liberty.

C"ie 8usti!e 'rteio . anganibans p"ilosop"y o liberty ist"us ost relevant. e said: I' /%)*) i'6ol6i' li*r+, +$*)/%l*) o H)+i/* )$ol( *i$ $*%6il %%i')+ o6*r'&*'+%'( i' %6or o +$* poor, +$* oppr*))*(, +$* &%ri'%li*(,+$* (i)po))*))*( %'( +$* *%: . $aws and a!tions t"arestri!t undaental rig"ts !oe to t"e !ourts wit" a "eavy presuption against t"eir !onstitutional validity.<

T"ese seven (7) !onsolidated petitions or certiorari and pro"ibition allege t"at in issuing residential ro!laation o. 1>17 ( 1>17) and &eneral Order o. = (&.O. o. =)resident &loria +a!apagal#'rroyo !oitted grave abuse odis!retion. etitioners !ontend t"at respondent oi!ials o t"e&overnent, in t"eir proessed eorts to deend and preservedeo!rati! institutions, are a!tually trapling upon t"e veryreedo guaranteed and prote!ted by t"e Constitution. en!esu!" issuan!es are void or being un!onstitutional.

On!e again, t"e Court is a!ed wit" an age#old but persistentlyodern proble. 6o$ does the Constitution o' a 'ree people

http://www.lawphil.net/judjuris/juri2006/may2006/gr_171396_2006.html#fnt1








combine the degree o' liberty 7 $ithout $hich7 la$ becomes

tyranny7 $ith the degree o' la( 7 $ithout $hich7 liberty

becomes licenseP5

On February <A, <>>6, as t"e nation !elebrated t"e <>t"'nniversary o t"e Edsa People Po$er I , resident 'rroyoissued 1>17 de!laring a state o national eergen!y, t"us:

NO;, TEREFORE, I, &loria +a!apagal#'rroyo, resident

o t"e -epubli! o t"e "ilippines and Coander#in#C"ie o t"e 'red For!es o t"e "ilippines, by virtue o t"e powersvested upon e by e!tion 1?, 'rti!le 7 o t"e "ilippineConstitution w"i!" states t"at: T"e resident. . . w"enever it be!oes ne!essary, . . . ay !all out (t"e) ared or!es to prevent or suppress. . .rebellion. . ., and in y !apa!ity ast"eir Coander#in#C"ie, (o $*r* /o&&%'( +$* Ar&*(For/*) o +$* #$ilippi'*), +o &%i'+%i' l% %'( or(*r+$ro$o+ +$* #$ilippi'*), pr*6*'+ or )ppr*)) %ll or&)o l%l*)) 6iol*'/* %) *ll %) %' %/+ o i')rr*/+io' orr**llio' %'( +o *'or/* o*(i*'/* +o %ll +$* l%) %'( +o %ll(*/r**), or(*r) %'( r*l%+io') pro&l%+*( &*p*r)o'%ll or po' & (ir*/+io'; and %) pro6i(*( i'S*/+io' 17, Ar+i/l* 12 o +$* Co')+i++io' (o $*r* (*/l%r*% S+%+* o N%+io'%l E&*r*'/.

"e !ited t"e ollowing a!ts as bases:

;EREAS, over t"ese past ont"s, eleents in t"e poli+i/%loppo)i+io' $%6* /o')pir*( i+$ %+$ori+%ri%') o +$**5+r*&* L*+ r*pr*)*'+*( +$* N"F<C##<N#A %'( +$**5+r*&* Ri$+, r*pr*)*'+*( &ili+%r %(6*'+ri)+) +$*$i)+ori/%l *'*&i*) o +$* (*&o/r%+i/ #$ilippi'* S+%+* M w"oare now in a ta!ti!al allian!e and engaged in a !on!erted andsysteati! !onspira!y, over a broad ront, to bring down t"eduly !onstituted &overnent ele!ted in +ay <>>A;

;EREAS, t"ese !onspirators "ave repeatedly tried to bringdown t"e resident;

;EREAS, +$* /l%i&) o +$*)* *l*&*'+) $%6* **'r*/:l*))l &%'ii*( /*r+%i' )*&*'+) o +$* '%+io'%l&*(i%

;EREAS, t"is series o a!tions is "urting t"e "ilippinetate M by obstru!ting governan!e in!luding $i'(*ri' +$*ro+$ o +$* */o'o& %'( )%o+%i' +$* p*opl*)/o'i(*'/* i' o6*r'&*'+ %'( +$*ir %i+$ i' +$* +r* o +$i) /o'+r;

;EREAS, t"ese %/+io') %r* %(6*r)*l %*/+i' +$**/o'o&

;EREAS, +$*)* %/+i6i+i*) i6* +o+%li+%ri%' or/*) o o+$+$* *5+r*&* L*+ %'( *5+r*&* Ri$+ +$* op*'i' +oi'+*')i +$*ir %6o*( %i&) +o ri' (o' +$* (*&o/r%+i/#$ilippi'* S+%+*;

;EREAS, 'rti!le <, e!tion A o t"e our Constitutiona2es t"e deense and preservation o t"e deo!rati!institutions and t"e tate t"e priary duty o &overnent;

;EREAS, t"e a!tivities above#des!ribed, t"eir!onseuen!es, raii!ations and !ollateral ee!ts !onstitute a/l*%r %'( pr*)*'+ (%'*r to t"e saety and t"e integrity o t"e"ilippine tate and o t"e Filipino people;

On t"e sae day, t"e resident issued &. O. o. =ipleenting 1>17, t"us:

;EREAS, over t"ese past ont"s, eleents in t"e politi!al

opposition "ave !onspired wit" aut"oritarians o t"e e*tree$et, represented by t"e F#C#' and t"e e*tree-ig"t, represented by ilitary adventurists # t"e "istori!aeneies o t"e deo!rati! "ilippine tate M and w"o are nowin a ta!ti!al allian!e and engaged in a !on!erted andsysteati! !onspira!y, over a broad ront, to bring down t"eduly#!onstituted &overnent ele!ted in +ay <>>A;

;EREAS, t"ese !onspirators "ave repeatedly tried to bringdown our republi!an governent;

;EREAS, t"e !lais o t"ese eleents "ave beenre!2lessly agniied by !ertain segents o t"e nationa

edia;

;EREAS, t"ese series o a!tions is "urting t"e "ilippinetate by obstru!ting governan!e, in!luding "indering t"egrowt" o t"e e!onoy and sabotaging t"e peoples!oniden!e in t"e governent and t"eir ait" in t"e uture ot"is !ountry;

;EREAS, t"ese a!tions are adversely ae!ting t"ee!onoy;

;EREAS, t"ese a!tivities give totalitarian or!es; o bot"t"e e*tree $et and e*tree -ig"t t"e opening to intensiy

t"eir avowed ais to bring down t"e deo!rati! "ilippinetate;

;EREAS, 'rti!le <, e!tion A o our Constitution a2est"e deense and preservation o t"e deo!rati! institutions andt"e tate t"e priary duty o &overnent;

;EREAS, t"e a!tivities above#des!ribed, t"eir!onseuen!es, raii!ations and !ollateral ee!ts !onstitute a!lear and present danger to t"e saety and t"e integrity o t"e"ilippine tate and o t"e Filipino people;

;EREAS, ro!laation 1>17 date February <A, <>>6 "as been issued de!laring a tate o ational %ergen!y;

NO;, TEREFORE, I GLORIA MACA#AGALARROYO, by virtue o t"e powers vested in e under t"eConstitution as resident o t"e -epubli! o t"e "ilippines,and Coander#in#C"ie o t"e -epubli! o t"e "ilippinesand pursuant to ro!laation o. 1>17 dated February <A<>>6, do "ereby !all upon t"e 'red For!es o t"e "ilippines('F) and t"e "ilippine ational oli!e (), to preventand suppress a!ts o terroris and lawless violen!e in t"e!ountry;





I "ereby dire!t t"e C"ie o ta o t"e 'F and t"e C"ie o t"e , as well as t"e oi!ers and en o t"e 'F and ,+o i&&*(i%+*l /%rr o+ +$* '*/*))%r %'( %ppropri%+*%/+io') %'( &*%)r*) +o )ppr*)) %'( pr*6*'+ %/+) o +*rrori)& %'( l%l*)) 6iol*'/*.

On +ar!" 5, <>>6, e*a!tly one wee2 ater t"e de!laration o astate o national eergen!y and ater all t"ese petitions "ad been iled, t"e resident lited 1>17. "e issued

ro!laation o. 1><1 w"i!" reads:

;EREAS, pursuant to e!tion 1?, 'rti!le II and e!tion17, 'rti!le /II o t"e Constitution, ro!laation o. 1>17dated February <A, <>>6, was issued de!laring a state o national eergen!y;

;EREAS, by virtue o &eneral Order o.= and o.6 datedFebruary <A, <>>6, w"i!" were issued on t"e basis o ro!laation o. 1>17, t"e 'red For!es o t"e "ilippines('F) and t"e "ilippine ational oli!e (), were dire!tedto aintain law and order t"roug"out t"e "ilippines, preventand suppress all or o lawless violen!e as well as any a!t o

rebellion and to underta2e su!" a!tion as ay be ne!essary;

;EREAS, t"e 'F and "ave ee!tively prevented,suppressed and uelled t"e a!ts lawless violen!e and rebellion;

NO;, TEREFORE, I, GLORIA MACA#AGAL<ARROYO, resident o t"e -epubli! o t"e "ilippines, byvirtue o t"e powers vested in e by law, "ereby (*/l%r* +$%++$* )+%+* o '%+io'%l *&*r*'/ $%) /*%)*( +o *5i)+.

In t"eir presentation o t"e a!tual bases o 1>17 and &.O. o. =, respondents stated t"at t"e pro*iate !ause be"ind t"ee*e!utive issuan!es was t"e !onspira!y aong soe ilitary

oi!ers, letist insurgents o t"e ew eoples 'ry ('),and soe ebers o t"e politi!al opposition in a plot tounseat or assassinate resident 'rroyo. A T"ey !onsidered t"eai to oust or assassinate t"e resident and ta2e#over t"ereigns o governent as a !lear and present danger.

uring t"e oral arguents "eld on +ar!" 7, <>>6, t"eoli!itor &eneral spe!iied t"e a!ts leading to t"e issuan!e o 1>17 and &.O. o. =. Si'ii/%'+l, +$*r* %) 'or*+%+io' ro& p*+i+io'*r) /o')*l).

T"e oli!itor &eneral argued t"at t"e intent o t"e Constitutionis to give ull (i)/r*+io'%r po*r) to t"e resident in

deterining t"e ne!essity o !alling out t"e ared or!es. eep"asiBed t"at none o t"e petitioners "as s"own t"at 1>17 was wit"out a!tual bases. E"ile "e e*plained t"at it isnot respondents tas2 to state t"e a!ts be"ind t"e uestionedro!laation, "owever, t"ey are presenting t"e sae, narrated"ereunder, or t"e elu!idation o t"e issues.

On 8anuary 17, <>>6, Captain at"aniel -abonBa and First$ieutenants onny ariento, $awren!e an 8uan and atri!io4uidang, ebers o t"e +agdalo &roup indi!ted in t"eOa2wood utiny, es!aped t"eir detention !ell in Fort4onia!io, Taguig City. In a publi! stateent, t"ey vowed to

reain deiant and to elude arrest at all !osts. T"ey !alledupon t"e people to sho$ and proclaim our displeasure at the

sham regime 1et us demonstrate our disgust7 not only by going to the streets in protest7 but also by $earing red bands

on our le't arms =

On February 17, <>>6, t"e aut"orities got "old o a do!uententitled Oplan 6ac8le I w"i!" detailed plans or bobingsand atta!2s during t"e "ilippine +ilitary '!adey 'luni

oe!oing in 4aguio City. T"e plot was to assassinatesele!ted targets in!luding soe !abinet ebers andresident 'rroyo "ersel.6 0pon t"e advi!e o "er se!urityresident 'rroyo de!ided not to attend t"e 'lunoe!oing. T"e ne*t day, at t"e "eig"t o t"e !elebration, a bob was ound and detonated at t"e +' parade ground.

On February <1, <>>6, $t. an 8uan was re!aptured in a!ounist sae"ouse in 4atangas provin!e. Found in "is possession were two (<) las" dis2s !ontaining inutes o t"eeetings between ebers o t"e +agdalo &roup and t"e ational eoples 'ry ('), a tape re!order, audio !assette!artridges, dis2ettes, and !opies o subversive do!uents.rior to "is arrest, $t. an 8uan announ!ed t"roug" Q- t"att"e 9agdalo:s D;Day $ould be on February <=7 <>>?7 the

<>th +nniversary o' Edsa I@

On February <5, <>>6, C"ie 'rturo $oibao inter!eptedinoration t"at ebers o t"e # pe!ial '!tion For!ewere planning to dee!t. T"us, "e iediately ordered 'FCoanding &eneral +ar!elino Fran!o, 8r. to @disavo$@ anydee!tion. T"e latter proptly obeyed and issued a publi!stateent: +ll S+F units are under the e''ective control o'responsible and trust$orthy o''icers $ith proven integrity and

un0uestionable loyalty

On t"e sae day, at t"e "ouse o orer Congressan epingCo3uang!o, resident Cory 'uinos brot"er, businessen andid#level governent oi!ials plotted oves to bring downt"e 'rroyo adinistration. elly indayen o TI+% +agaBinereported t"at astor ay!on, longtie 'rroyo !riti!, !alled a0.. governent oi!ial about "is groups plans i resident'rroyo is ousted. ay!on also p"oned a an !ode#naedelta. ay!on identiied "i as 4&en. anilo $iCoander o t"e 'rys elite !out -anger. $i said i

$as all systems go 'or the planned movement against +rroyo?

4&en. anilo $i and 4rigade Coander Col. 'rie

Huerubin !onided to &en. &eneroso enga, C"ie o ta ot"e 'red For!es o t"e "ilippines ('F), t"at a "ugenuber o soldiers would 3oin t"e rallies to provide a !riti!alass and ared !oponent to t"e 'nti#'rroyo protests to be"eld on February <A, <>>=. '!!ording to t"ese two (<)oi!ers, t"ere was no way t"ey !ould possibly stop t"esoldiers be!ause t"ey too, were brea2ing t"e !"ain o!oand to 3oin t"e or!es oist to unseat t"e residentowever, &en. enga "as reained ait"ul to "iCoander#in#C"ie and to t"e !"ain o !oand. eiediately too2 !ustody o 4&en. $i and dire!ted ColHuerubin to return to t"e "ilippine +arines eaduarters inFort 4onia!io.














%arlier, t"e C#' !alled or intensii!ation o politi!al andrevolutionary wor2 wit"in t"e ilitary and t"e poli!eestablis"ents in order to orge allian!es wit" its ebersand 2ey oi!ials. ' spo2esan &regorio Na -oger -osalde!lared: !he Communist Party and revolutionary movement

and the entire people loo8 'or$ard to the possibility in the

coming year o' accomplishing its immediate tas8 o' bringing do$n the +rroyo regime( o' rendering it to $ea8en and unable

to rule that it $ill not ta8e much longer to end it .9

On t"e ot"er "and, Cesar -enerio, spo2esan or t"e ationaleo!rati! Front (F) at ort" Central +indanao, publi!lyannoun!ed: +nti;+rroyo groups $ithin the military and

police are gro$ing rapidly7 hastened by the economic

di''iculties su''ered by the 'amilies o' +FP o''icers and

enlisted personnel $ho underta8e counter;insurgency

operations in the 'ield e !laied t"at wit" t"e or!es o t"enational deo!rati! oveent, t"e anti#'rroyo !onservative politi!al parties, !oalitions, plus t"e groups t"at "ave beenreinor!ing sin!e 8une <>>=, it is probable t"at t"e residentsouster is nearing its !on!luding stage in t"e irst "al o <>>6.

-espondents urt"er !laied t"at t"e bobing o tele!ouni!ation towers and !ell sites in 4ula!an and4ataan was also !onsidered as additional a!tual basis or t"eissuan!e o 1>17 and &.O. o. =. o is t"e raid o an aryoutpost in 4enguet resulting in t"e deat" o t"ree (5) soldiers.'nd also t"e dire!tive o t"e Counist arty o t"e"ilippines ordering its ront organiBations to 3oin =,>>> +etro+anila radi!als and <=,>>> ore ro t"e provin!es in ass protests.1>

4y idnig"t o February <5, <>>6, t"e resident !onvened "er se!urity advisers and several !abinet ebers to assess t"egravity o t"e erenting pea!e and order situation. "edire!ted bot" t"e 'F and t"e to a!!ount or all t"eir enand ensure t"at t"e !"ain o !oand reains solid andundivided. To prote!t t"e young students ro any possibletrouble t"at ig"t brea2 loose on t"e streets, t"e residentsuspended !lasses in all levels in t"e entire ational Capital-egion.

For +$*ir p%r+, p*+i+io'*r) /i+*( +$* *6*'+) +$%+ ollo*(%+*r +$* i))%'/* o ## 1017 %'( G.O. No. -.

Iediately, t"e Oi!e o t"e resident announ!ed t"e!an!ellation o all progras and a!tivities related to t"e <>t"anniversary !elebration o Edsa People Po$er I ; and revo2ed

t"e perits to "old rallies issued earlier by t"e lo!algovernents. 8usti!e e!retary -aul &onBales stated t"at politi!al rallies, w"i!" to t"e residents ind were organiBedor purposes o destabiliBation, are !an!elled.residentialC"ie o ta +i!"ael eensor announ!ed t"at $arrantless

arrests and ta8e;over o' 'acilities7 including media7 can

already be implemented .11

0ndeterred by t"e announ!eents t"at rallies and publi!asseblies would not be allowed, groups o protesters(ebers o -ilusang 9ayo 3no JN+0K and ationalFederation o $abor 0nions# -ilusang 9ayo 3no J'F$0#N+0K), ar!"ed ro various parts o +etro +anila wit" t"e

intention o !onverging at t"e %' s"rine. T"ose w"o werealready near t"e %' site were violently dispersed by "uge!lusters o anti#riot poli!e. T"e well#trained poli!een usedtrun!"eons, big iber glass s"ields, water !annons, and tear gasto stop and brea2 up t"e ar!"ing groups, and s!atter t"eassed parti!ipants. T"e sae poli!e a!tion was used againstt"e protesters ar!"ing orward to Cubao, HueBon City and tot"e !orner o antolan treet and %'. T"at sae evening"undreds o riot poli!een bro2e up an %' !elebrationrally "eld along 'yala 'venue and aseo de -o*as treet in+a2ati City.1<

'!!ording to petitioner -ilusang 9ayo 3no, t"e poli!e !ited 1>17 as t"e ground or t"e dispersal o t"eir asseblies.

uring t"e dispersal o t"e rallyists along %', poli!earrested (wit"out warrant) petitioner -andol . avid, a proessor at t"e 0niversity o t"e "ilippines and newspaper!olunist. 'lso arrested was "is !opanion, -onald $laas, president o party#list +8bayan.

't around 1<:<> in t"e early orning o February <=, <>>6,

operatives o t"e Criinal Investigation and ete!tion &roup(CI&) o t"e , on t"e basis o 1>17 and &.O. o. =,raided t"e Daily !ribune oi!es in +anila. T"e raiding tea!onis!ated news stories by reporters, do!uents, pi!turesand o!2#ups o t"e aturday issue. oli!een ro CapCrae in HueBon City were stationed inside t"e editorial and business oi!es o t"e newspaper; w"ile poli!een ro t"e+anila oli!e istri!t were stationed outside t"e building.15

' ew inutes ater t"e sear!" and seiBure at t"e Daily

!ribune oi!es, t"e poli!e surrounded t"e preises o anot"er pro#opposition paper, +alaya, and its sister publi!ation, t"etabloid 'bante.

T"e raid, a!!ording to residential C"ie o ta +i!"aeeensor, is @meant to sho$ a Astrong presence7: to tell media

outlets not to connive or do anything that $ould help therebels in bringing do$n this government@ T"e warnedt"at it would ta2e over any edia organiBation t"at would noollow @standards set by the government during the state o'

national emergency@ ire!tor &eneral $oibao stated t"at @i'they do not 'ollo$ the standards ) and the standards are ; i'

they $ould contribute to instability in the government7 or i'

they do not subscribe to $hat is in General Order 5o B and

Proc 5o ">" ) $e $ill recommend a Ata8eover:@ ationaTele!ouni!ations Coissioner -onald olis urged

television and radio networ2s to @cooperate@ wit" t"egovernent or t"e duration o t"e state o nationaeergen!y. e as2ed or @balanced reporting@ ro broad!asters w"en !overing t"e events surrounding t"e !oupattept oiled by t"e governent. e warned t"at "is agen!ywill not "esitate to re!oend t"e !losure o any broad!astoutit t"at violates rules set out or edia !overage w"en t"enational se!urity is t"reatened.1A

'lso, on February <=, <>>6, t"e poli!e arrested CongressanCrispin 4eltran, representing t"e +na8pa$is arty andC"airan o -ilusang 9ayo 3no (N+0), w"ile leaving "isar"ouse in 4ula!an. T"e poli!e s"owed a warrant or "is
















arrest dated 19?=. 4eltrans lawyer e*plained t"at t"e warrant,w"i!" steed ro a !ase o in!iting to rebellion iledduring t"e +ar!os regie, "ad long been uas"ed. 4eltran,"owever, is not a party in any o t"ese petitions.

E"en ebers o petitioner N+0 went to Cap Crae tovisit 4eltran, t"ey were told t"ey !ould not be aditted be!ause o 1>17 and &.O. o. =. Two ebers werearrested and detained, w"ile t"e rest were dispersed by t"e

poli!e.

ayan 9una -epresentative atur O!apo eluded arrest w"ent"e poli!e went ater "i during a publi! oru at t"e ulootel in HueBon City. 4ut "is two drivers, identiied as -oeland 'rt, were ta2en into !ustody.

-etired +a3or &eneral -aon +ontaRo, orer "ead o t"e"ilippine Constabulary, was arrested w"ile wit" "is wie andgolates at t"e Or!"ard &ol and Country Club inasariRas, Cavite.

'ttepts were ade to arrest +na8pa$is -epresentative atur

O!apo, -epresentative -aael +ariano, ayan 9una-epresentative Teodoro CasiRo and &abriela -epresentative$iBa +aBa. ayan 9una -epresentative 8osel irador wasarrested at t"e '$ Ti!2et Oi!e in avao City. $ater, "e wasturned over to t"e !ustody o t"e ouse o -epresentativesw"ere t"e 4atasan = de!ided to stay indeinitely.

$et it be stressed at t"is point t"at t"e alleged violations o t"erig"ts o -epresentatives 4eltran, atur O!apo, et al ., are not being raised in t"ese petitions.

On +ar!" 5, <>>6, resident 'rroyo issued 1><1 de!laringt"at t"e state o national eergen!y "as !eased to e*ist.

In t"e interi, t"ese seven (7) petitions !"allenging t"e!onstitutionality o 1>17 and &.O. o. = were iled wit"t"is Court against t"e above#naed respondents. T"ree (5) o t"ese petitions ipleaded resident 'rroyo as respondent.

In G.R. No. 17139, petitioners -andol . avid, et al .assailed 1>17 on t"e grounds t"at ?1@ it en!roa!"es on t"eeergen!y powers o Congress; ?2@ itis a subteruge to avoidt"e !onstitutional reuireents or t"e iposition o artiallaw; and ?3@ it violates t"e !onstitutional guarantees o reedo o t"e press, o spee!" and o assebly.

In G.R. No. 171409, petitioners ineB Ca!"o#Olivares and!ribune ublis"ing Co., In!. !"allenged t"e CI&s a!t o raiding t"e Daily !ribune oi!es as a !lear !ase o !ensors"ip or prior restraint. T"ey also !laied t"at t"eter eergen!y reers only to tsunai, typ"oon, "urri!aneand siilar o!!urren!es, "en!e, t"ere is absolutely noemergency t"at warrants t"e issuan!e o 1>17.

In G.R. No. 1714- 7 petitioners "erein are -epresentativeFran!is 8osep" &. %s!udero, and twenty one (<1) ot"er ebers o t"e ouse o -epresentatives, in!luding-epresentatives atur O!apo, -aael +ariano, Teodoro

CasiRo, $iBa +aBa, and 8osel irador T"ey asserted t"at 1>17 and &.O. o. = !onstitute usurpation o' legislative

po$ers; violation o' 'reedom o' e%pression and adeclaration o' martial la$. T"ey alleged t"at residen'rroyo gravely abused her discretion in calling out the

armed 'orces $ithout clear and veri'iable 'actual basis o' the

possibility o' la$less violence and a sho$ing that there isnecessity to do so

In G.R. No. 17143 7 petitioners N+0, 'F$0#N+0, andt"eir ebers averred t"at 1>17 and &.O. o. = areun!onstitutional be!ause ?1@ t"ey arrogate unto residen'rroyo t"e power to ena!t laws and de!rees; ?2@ t"eir issuan!ewas wit"out a!tual basis; and ?3@ t"ey violate reedo oe*pression and t"e rig"t o t"e people to pea!eably assebleto redress t"eir grievan!es.

In G.R. No. 171400 7 petitioner 'lternative $aw &roups, In!('$&I) alleged t"at 1>17 and &.O. o. = areun!onstitutional be!ause t"ey violate ?%@ e!tion A1= o 'rti!leII, ?@ e!tions 1,16 <,17 and A1? o 'rti!le III, ?/@ e!tion <51

o 'rti!le I, and ?(@ e!tion 17<> o 'rti!le /II o t"eConstitution.

In G.R. No. 17149, petitioners 8ose 'nselo I. CadiB et alalleged t"at 1>17 is an arbitrary and unla$'ul e%ercise by

the President o' her 9artial 1a$ po$ers. 'nd assuing t"a 1>17 is not really a de!laration o +artial $aw, petitionersargued t"at it amounts to an e%ercise by the President o'

emergency po$ers $ithout congressional approval Inaddition, petitioners asserted t"at 1>17 goes beyond the

nature and 'unction o' a proclamation as de'ined under the Revised +dministrative Code@

'nd lastly, in G.R. No. 171424,petitioner$oren 4. $egarda

aintained t"at 1>17 and &.O. o. = are unconstitutiona 'or being violative o' the 'reedom o' e%pression7 including itscognate rights such as 'reedom o' the press and the right to

access to in'ormation on matters o' public concern7 all

guaranteed under +rticle III7 Section = o' the "

Constitution In t"is regard, s"e stated t"at t"ese issuan!es prevented "er ro ully prose!uting "er ele!tion protes pending beore t"e residential %le!toral Tribunal.

In respondents Consolidated Coent, t"e oli!itor &eneral!ountered t"at: 'irst7 t"e petitions s"ould be disissed o being oot; second7 petitioners in &.-. os. 171A>> ('$&I)171A<A ($egarda), 171A?5 (N+0 et al .), 171A?= (%s!udero e

al) and 171A?9 (CadiB et al .) "ave no legal standing; third , iis not ne!essary or petitioners to iplead resident 'rroyo asrespondent; 'ourth7 1>17 "as !onstitutional and legal basisand 'i'th7 1>17 does not violate t"e peoples rig"t to reee*pression and redress o grievan!es.

On +ar!" 7, <>>6, t"e Court !ondu!ted oral arguents and"eard t"e parties on t"e above interlo!2ing issues w"i!" ay be suariBed as ollows:

A. #ROCE"URAL




















1@ E"et"er t"e issuan!e o 1><1 renders t"e petitions oot and a!adei!.

2@ E"et"er petitioners in 1714- (%s!udero et al),G.R. No). 171400 ('$&I), 17143 (N+0 et al .),17149 (CadiB et al .), and 171424 ($egarda) "avelegal standing.

!. SU!STANTIE

1@ E"et"ert"e upree Court !an review t"e a!tual bases o 1>17.

2@ E"et"er 1>17 and &.O. o. = areun!onstitutional.

%. Fa!ial C"allenge

. Constitutional 4asis

/. 's 'pplied C"allenge

A. #ROCE"URAL

First, we ust resolve t"e pro!edural roadblo!2s.

I* 'oot and Academic Principle

One o t"e greatest !ontributions o t"e 'eri!an syste tot"is !ountry is t"e !on!ept o 3udi!ial review enun!iated in

9arbury v 9adison<1 T"is !on!ept rests on t"e e*traordinarysiple oundation ##

T"e Constitution is t"e supree law. It was ordained by t"e people, t"e ultiate sour!e o all politi!al aut"ority. It !onersliited powers on t"e national governent. * * * I +$*o6*r'&*'+ /o')/io)l or '/o')/io)l o6*r)+*p) +$*)*li&i+%+io') +$*r* &)+ * )o&* %+$ori+ /o&p*+*'+ +o $ol(i+ i' /o'+rol, +o +$%r+ i+) '/o')+i++io'%l %++*&p+, %'(+$) +o 6i'(i/%+* %'( pr*)*r6* i'6iol%+* +$* ill o +$*p*opl* %) *5pr*))*( i' +$* Co')+i++io'. T$i) po*r +$*/or+) *5*r/i)*. T$i) i) +$* *i''i' %'( +$* *'( o +$*+$*or o H(i/i%l r*6i*.<<

4ut t"e power o 3udi!ial review does not repose upon t"e!ourts a sel#starting !apa!ity.<5 Courts ay e*er!ise su!" power only w"en t"e ollowing reuisites are present: 'irst7

t"ere ust be an a!tual !ase or !ontroversy; second7 petitioners "ave to raise a uestion o !onstitutionality; third7t"e !onstitutional uestion ust be raised at t"e earliestopportunity; and 'ourth7 t"e de!ision o t"e !onstitutionaluestion ust be ne!essary to t"e deterination o t"e !aseitsel .<A

-espondents aintain t"at t"e irst and se!ond reuisites areabsent, "en!e, we s"all liit our dis!ussion t"ereon.

'n a!tual !ase or !ontroversy involves a !onli!t o legal rig"t,an opposite legal !lais sus!eptible o 3udi!ial resolution. It is

deinite and !on!rete, tou!"ing t"e legal relations o parties"aving adverse legal interest; a real and substantia!ontroversy aditting o spe!ii! relie.<= T"e oli!ito&eneral reutes t"e e*isten!e o su!" a!tual !ase o!ontroversy, !ontending t"at t"e present petitions wererendered oot and a!adei! by resident 'rroyos issuan!eo 1><1.

u!" !ontention la!2s erit.

' oot and a!adei! !ase is one t"at !eases to present a 3usti!iable !ontroversy by virtue o supervening events,<6 sot"at a de!laration t"ereon would be o no pra!ti!al use orvalue.<7 &enerally, !ourts de!line 3urisdi!tion over su!" !ase<

or disiss it on ground o ootness. <9

T"e Court "olds t"at resident 'rroyos issuan!e o 1><1did not render t"e present petitions oot and a!adei!uring t"e eig"t (?) days t"at 1>17 was operative, t"e poli!e oi!ers, a!!ording to petitioners, !oitted illegal a!tsin ipleenting it. Ar* ## 1017 %'( G.O. No. -/o')+i++io'%l or 6%li(K "o +$* H)+i +$*)* %ll**( ill*%

%/+)K T"ese are t"e vital issues t"at ust be resolved in t"e present petitions. It ust be stressed t"at %' '/o')+i++io'%%/+ i) 'o+ % l%, i+ /o'*r) 'o ri$+), i+ i&po)*) 'o (+i*), i+%or() 'o pro+*/+io' i+ i) i' l*%l /o'+*&pl%+io'i'op*r%+i6*.5>

T"e oot and a!adei! prin!iple is not a agi!al orulat"at !an autoati!ally dissuade t"e !ourts in resolving a !aseCourts will de!ide !ases, ot"erwise oot and a!adei!, i

'irst7 t"ere is a grave violation o t"e Constitution; 51 secondt"e e*!eptional !"ara!ter o t"e situation and t"e paraount publi! interest is involved;5< third7 w"en !onstitutional issueraised reuires orulation o !ontrolling prin!iples to guide

t"e ben!", t"e bar, and t"e publi!;55

and 'ourth7 t"e !ase is!apable o repetition yet evading review.5A

'll t"e oregoing e*!eptions are present "ere and 3ustiy t"isCourts assuption o 3urisdi!tion over t"e instant petitionsetitioners alleged t"at t"e issuan!e o 1>17 and &.O. o= violates t"e Constitution. T"ere is no uestion t"at t"e issues being raised ae!t t"e publi!s interest, involving as t"ey dot"e peoples basi! rig"ts to reedo o e*pression, o asseblyand o t"e press. +oreover, t"e Court "as t"e duty toorulate guiding and !ontrolling !onstitutional pre!eptsdo!trines or rules. It "as t"e syboli! un!tion o edu!atingt"e ben!" and t"e bar, and in t"e present petitions, +$*

&ili+%r %'( +$* poli/*, on t"e e*tent o t"e prote!tion given by !onstitutional guarantees.5= 'nd lastly, respondents!ontested a!tions are !apable o repetition. Certainly, t"e petitions are sub3e!t to 3udi!ial review.

In t"eir attept to prove t"e alleged ootness o t"is !aserespondents !ited C"ie 8usti!e 'rteio . anganibanseparate Opinion in Sanla8as v E%ecutive Secretary.5

owever, t"ey ailed to ta2e into a!!ount t"e C"ie 8usti!esvery stateent t"at an ot"erwise oot !ase ay still bede!ided provided the party raising it in a proper case has

been andor continues to be preHudiced or damaged as a direc

result o' its issuance T"e present !ase alls rig"t wit"in t"is
















































e*!eption to t"e ootness rule pointed out by t"e C"ie 8usti!e.

II* Leal +tandin

In view o t"e nuber o petitioners suing in various personalities, t"e Court dees it iperative to "ave a oret"an passing dis!ussion on legal standing or locus standi

1ocus standi is deined as a rig"t o appearan!e in a !ourt o 3usti!e on a given uestion.57 In private suits, standing isgoverned by t"e real#parties#in interest rule as !ontained ine!tion <, -ule 5 o t"e 1997 -ules o Civil ro!edure, asaended. It provides t"at *6*r %/+io' &)+ * pro)*/+*(or (**'(*( i' +$* '%&* o +$* r*%l p%r+ i' i'+*r*)+ .'!!ordingly, t"e real#party#in interest is +$* p%r+ $o)+%'() +o * *'*i+*( or i'Hr*( +$* H(&*'+ i' +$*)i+ or +$* p%r+ *'+i+l*( +o +$* %6%il) o +$* )i+.5?

u!!in!tly put, t"e plaintis standing is based on "is ownrig"t to t"e relie soug"t.

T"e dii!ulty o deterining locus standi arises in pli/

)i+). ere, t"e plainti w"o asserts a publi! rig"t inassailing an allegedly illegal oi!ial a!tion, does so as arepresentative o t"e general publi!. e ay be a person w"ois ae!ted no dierently ro any ot"er person. e !ould besuing as a stranger, or in t"e !ategory o a !itiBen, or Sta*payer. In eit"er !ase, "e "as to adeuately s"ow t"at "e isentitled to see2 3udi!ial prote!tion. In ot"er words, "e "as toa2e out a sui!ient interest in t"e vindi!ation o t"e publi!order and t"e se!uring o relie as a !itiBen or ta*payer.

Case law in ost 3urisdi!tions now allows bot" !itiBen andta*payer standing in publi! a!tions. T"e distin!tion was irstlaid down in eauchamp v Sil8 ,59 w"ere it was "eld t"at t"e

plainti in a ta*payers suit is in a dierent !ategory ro t"e plainti in a !itiBens suit. I' +$* or&*r, +$* pl%i'+i i)%*/+*( +$* *5p*'(i+r* o pli/ '(), $il* i' +$*l%++*r, $* i) + +$* &*r* i')+r&*'+ o +$* pli/ /o'/*r'.'s "eld by t"e ew Lor2 upree Court in People e% rel

Case v Collins:A> I' &%++*r o &*r* pli/ ri$+,$o*6*r+$* p*opl* %r* +$* r*%l p%r+i*)I+ i) %+ l*%)+ +$*ri$+, i 'o+ +$* (+, o *6*r /i+i*' +o i'+*r*r* %'( )**+$%+ % pli/ o*'/* * prop*rl pr)*( %'( p'i)$*(,%'( +$%+ % pli/ ri*6%'/* * r*&*(i*( . Eit" respe!t tota*payers suits, !err v 4ordanA1 "eld t"at +$* ri$+ o %/i+i*' %'( % +%5p%*r +o &%i'+%i' %' %/+io' i' /or+) +or*)+r%i' +$* 'l%l )* o pli/ '() +o $i) i'Hr

/%''o+ * (*'i*(.

owever, to prevent 3ust about any person ro see2ing 3udi!ial intereren!e in any oi!ial poli!y or a!t wit" w"i!" "edisagreed wit", and t"us "inders t"e a!tivities o governentalagen!ies engaged in publi! servi!e, t"e 0nited tate upreeCourt laid down t"e ore stringent (ir*/+ i'Hr +*)+ in E%

Parte 1evitt ,A< later reaired in !ileston v 3llmanA5 T"esae Court ruled t"at or a private individual to invo2e t"e 3udi!ial power to deterine t"e validity o an e*e!utive or legislative a!tion, $* &)+ )$o +$%+ $* $%) ))+%i'*( %(ir*/+ i'Hr %) % r*)l+ o +$%+ %/+io', %'( i+ i) 'o+

)i/i*'+ +$%+ $* $%) % *'*r%l i'+*r*)+ /o&&o' +o %ll&*&*r) o +$* pli/.

T"is Court adopted t"e 8(ir*/+ i'Hr8 +*)+ in our 3urisdi!tion. In People v .era,AA it "eld t"at t"e person w"oipugns t"e validity o a statute ust "ave % p*r)o'%l %'())+%'+i%l i'+*r*)+ i' +$* /%)* )/$ +$%+ $* $%) ))+%i'*(,or ill ))+%i' (ir*/+ i'Hr %) % r*)l+. T"e .era do!trinewas up"eld in a litany o !ases, su!" as, Custodio v President

o' the Senate,

A=

9anila Race 6orse !rainers: +ssociation v De la Fuente,A6 Pascual v Secretary o' Public or8sA7 and +nti;Chinese 1eague o' the Philippines v Feli%A?

owever, being a ere pro!edural te!"ni!ality, t"ereuireent o locus standi ay be waived by t"e Court in t"ee*er!ise o its dis!retion. T"is was done in t"e 1949E&*r*'/ #o*r) C%)*), +raneta v Dinglasan,A9 w"ere t"e+r%')/*'(*'+%l i&por+%'/* o t"e !ases propted t"eCourt to a!t liberally. u!" liberality was neit"er a rarity nora!!idental. In +0uino v Comelec,=> t"is Court resolved to passupon t"e issues raised due to t"e %r<r*%/$i' i&pli/%+io')o t"e petition notwit"standing its !ategori!al stateent t"at petitioner t"erein "ad no personality to ile t"e suit. Indeedt"ere is a !"ain o !ases w"ere t"is liberal poli!y "as beenobserved, allowing ordinary !itiBens, ebers o Congressand !ivi! organiBations to prose!ute a!tions involving t"e!onstitutionality or validity o laws, regulations and rulings.=1

T"us, t"e Court "as adopted a rule t"at even w"ere t"e petitioners "ave ailed to s"ow dire!t in3ury, t"ey "ave beenallowed to sue under t"e prin!iple o +r%')/*'(*'+%i&por+%'/*. ertinent are t"e ollowing !ases:

?1@ Chave2 v Public Estates +uthority 7=< w"ere t"eCourt ruled t"at +$* *'or/*&*'+ o +$*

/o')+i++io'%l ri$+ +o i'or&%+io' %'( +$**i+%l* (i)io' o '%+r%l r*)or/*) %r*&%++*r) o +r%')/*'(*'+%l i&por+%'/* $i/$/lo+$* +$* p*+i+io'*r i+$ locus standi

,-@ agong +lyansang 9a8abayan v Jamora7=

w"erein t"e Court "eld t"at 8i6*' +$*+r%')/*'(*'+%l i&por+%'/* o +$* i))*) i'6ol6*(+$* Cor+ &% r*l%5 +$* )+%'(i' r*ir*&*'+)%'( %llo +$* )i+ +o pro)p*r (*)pi+* +$* l%/: o(ir*/+ i'Hr +o +$* p%r+i*) )**:i' H(i/i%r*6i*8 o t"e isiting For!es 'greeent;

?3@ 1im v E%ecutive Secretary,=A

w"ile t"e Cournoted t"at t"e petitioners ay not ile suit in t"eir!apa!ity as ta*payers absent a s"owing t"a4ali2atan ><#>1 involves t"e e*er!ise o Congressta*ing or spending powers, it reiterated its ruling in

agong +lyansang 9a8abayan v Jamora7==+$%+ i'/%)*) o +r%')/*'(*'+%l i&por+%'/*, +$* /%)*) &)+* )*++l*( pro&p+l %'( (*i'i+*l %'( )+%'(i'r*ir*&*'+) &% * r*l%5*(.

4y way o suary, t"e ollowing rules ay be !ulled rot"e !ases de!ided by t"is Court. Ta*payers, voters, !on!erned



























































!itiBens, and legislators ay be a!!orded standing to sue, provided t"at t"e ollowing reuireents are et:

?1@ t"e !ases involve !onstitutional issues;

?2@ or +%5p%*r), t"ere ust be a !lai o illegaldisburseent o publi! unds or t"at t"e ta* easureis un!onstitutional;

?3@ or 6o+*r), t"ere ust be a s"owing o obviousinterest in t"e validity o t"e ele!tion law in uestion;

?4@ or /o'/*r'*( /i+i*'), t"ere ust be a s"owingt"at t"e issues raised are o trans!endental iportan!ew"i!" ust be settled early; and

?-@ or l*i)l%+or), t"ere ust be a !lai t"at t"eoi!ial a!tion !oplained o inringes upon t"eir prerogatives as legislators.

ignii!antly, re!ent de!isions s"ow a !ertain toug"ening int"e Courts attitude toward legal standing.

In -ilosbayan7 Inc v 9orato,=6 t"e Court ruled t"at t"e statuso -ilosbayan as a peoples organiBation does not give it t"ereuisite personality to uestion t"e validity o t"e on#linelottery !ontra!t, ore so w"ere it does not raise any issue o !onstitutionality. +oreover, it !annot sue as a ta*payer absentany allegation t"at publi! unds are being isused. or !an itsue as a !on!erned !itiBen as it does not allege any spe!ii!in3ury it "as suered.

In !elecommunications and roadcast +ttorneys o' the

Philippines7 Inc v Comelec,=7 t"e Court reiterated t"e dire!tin3ury test wit" respe!t to !on!erned !itiBens !ases involving!onstitutional issues. It "eld t"at t"ere ust be a s"owing t"att"e !itiBen personally suered soe a!tual or t"reatenedin3ury arising ro t"e alleged illegal oi!ial a!t.

In 1acson v Pere2 ,=? t"e Court ruled t"at one o t"e petitioners, 1aban ng Demo8rati8ong Pilipino ($), is not a real party#in#interest as it "ad not deonstrated any in3ury to itsel or toits leaders, ebers or supporters.

In Sanla8as v E%ecutive Secretary,=9 t"e Court ruled t"at onlyt"e petitioners w"o are ebers o Congress "ave standing tosue, as t"ey !lai t"at t"e residents de!laration o a state o

rebellion i) % )rp%+io' o +$* *&*r*'/ po*r) o Co'r*)), +$) i&p%iri' +$*ir l*i)l%+i6* po*r). 's to petitioners Sanla8as7 Partido 9anggaga$a7 and Social

4ustice Society, t"e Court de!lared t"e to be devoid o standing, euating t"e wit" t"e $ in 1acson.

ow, t"e appli!ation o t"e above prin!iples to t"e present petitions.

T"e locus standi o petitioners in G.R. No. 17139, parti!ularly avid and $laas, is beyond doubt. T"e sae"olds true wit" petitioners in G.R. No. 171409, Ca!"o#Olivares and !ribune ublis"ing Co. In!. T"ey alleged dire!t

in3ury resulting ro illegal arrest and unlawul sear!"!oitted by poli!e operatives pursuant to 1>17. -ig"tlyso, t"e oli!itor &eneral does not uestion t"eir legal standing

In G.R. No. 1714-, t"e opposition Congressen allegedt"ere was usurpation o legislative powers. T"ey also raisedt"e issue o w"et"er or not t"e !on!urren!e o Congress isne!essary w"enever t"e alaring powers in!ident to +artia$aw are used. +oreover, it is in t"e interest o 3usti!e t"at

t"ose ae!ted by 1>17 !an be represented by t"eirCongressen in bringing to t"e attention o t"e Court t"ealleged violations o t"eir basi! rig"ts.

In G.R. No. 171400, ('$&I), t"is Court applied t"e liberalityrule in Philconsa v Enri0ue2 ,6> -apatiran 5g 9ga

5agliling8od sa Pamahalaan ng Pilipinas7 Inc v !an,6

+ssociation o' Small 1ando$ners in the Philippines7 Inc v

Secretary o' +grarian Re'orm,6< asco v Philippine +musement and Gaming Corporation 765 and !aKada v

!uvera,6A t"at w"en t"e issue !on!erns a publi! rig"t, it issui!ient t"at t"e petitioner is a !itiBen and "as an interest int"e e*e!ution o t"e laws.

In G.R. No. 17143, N+0s assertion t"at 1>17 and &.O o. = violated its rig"t to pea!eul assebly ay be deeedsui!ient to give it legal standing. Or%'i%+io') &% *r%'+*( )+%'(i' +o %))*r+ +$* ri$+) o +$*ir &*&*r) .6

Ee ta2e 3udi!ial noti!e o t"e announ!eent by t"e Oi!e ot"e resident banning all rallies and !an!eling all perits or publi! asseblies ollowing t"e issuan!e o 1>17 and &.O o. =.

In G.R. No. 17149, petitioners, Cadi2 et al7 w"o are nationaoi!ers o t"e Integrated 4ar o t"e "ilippines (I4) "ave nolegal standing, "aving ailed to allege any dire!t or potential

in3ury w"i!" t"e I4 as an institution or its ebers aysuer as a !onseuen!e o t"e issuan!e o o. 1>17 and&.O. o. =. In Integrated ar o' the Philippines v Jamora76

t"e Court "eld t"at t"e ere invo!ation by t"e I4 o its dutyto preserve t"e rule o law and not"ing ore, w"ileundoubtedly true, is not sui!ient to !lot"e it wit" standing int"is !ase. T"is is too general an interest w"i!" is s"ared byot"er groups and t"e w"ole !itiBenry. owever, in view o t"etrans!endental iportan!e o t"e issue, t"is Court de!lares t"at petitioner "ave locus standi

In G.R. No. 171424, $oren $egarda "as no personality as ata*payer to ile t"e instant petition as t"ere are no allegations

o illegal disburseent o publi! unds. T"e a!t t"at s"e is aorer enator is o no !onseuen!e. "e !an no longer sue asa legislator on t"e allegation t"at "er prerogatives as alawa2er "ave been ipaired by 1>17 and &.O. o. =er !lai t"at s"e is a edia personality will not li2ewise aid"er be!ause t"ere was no s"owing t"at t"e enor!eent ot"ese issuan!es prevented "er ro pursuing "er o!!upationer subission t"at s"e "as pending ele!toral protest beoret"e residential %le!toral Tribunal is li2ewise o no relevan!e"e "as not sui!iently s"own t"at 1>17 will ae!t t"e pro!eedings or result o "er !ase. 4ut !onsidering on!e oret"e trans!endental iportan!e o t"e issue involved, t"is Courtay rela* t"e standing rules.





































It ust always be borne in ind t"at t"e uestion o locus

standi is but !orollary to t"e bigger uestion o proper e*er!iseo 3udi!ial power. T"is is t"e underlying legal tenet o t"eliberality do!trine on legal standing. It !annot be doubtedt"at t"e validity o o. 1>17 and &.O. o. = is a 3udi!ialuestion w"i!" is o paraount iportan!e to t"e Filipino people. To parap"rase 8usti!e $aurel, t"e w"ole o "ilippineso!iety now waits wit" bated breat" t"e ruling o t"is Court ont"is very !riti!al atter. T"e petitions t"us !all or t"eappli!ation o t"e +r%')/*'(*'+%l i&por+%'/* do!trine, arela*ation o t"e standing reuireents or t"e petitioners int"e 1>17 !ases."avvphilnet

T"is Court "olds t"at all t"e petitioners "erein "ave locus

standi.

In!identally, it is not proper to iplead resident 'rroyo asrespondent. ettled is t"e do!trine t"at t"e resident, during"is tenure o oi!e or a!tual in!uben!y,67 ay not be sued inany !ivil or !riinal !ase, and t"ere is no need to provide or itin t"e Constitution or law. It will degrade t"e dignity o t"e"ig" oi!e o t"e resident, t"e ead o tate, i "e !an bedragged into !ourt litigations w"ile serving as su!".Furt"erore, it is iportant t"at "e be reed ro any or o "arassent, "indran!e or distra!tion to enable "i to ullyattend to t"e peroran!e o "is oi!ial duties and un!tions.0nli2e t"e legislative and 3udi!ial bran!", only one !onstitutest"e e*e!utive bran!" and anyt"ing w"i!" ipairs "isuseulness in t"e dis!"arge o t"e any great and iportantduties iposed upon "i by t"e Constitution ne!essarilyipairs t"e operation o t"e &overnent. owever, t"is doesnot ean t"at t"e resident is not a!!ountable to anyone. $i2eany ot"er oi!ial, "e reains a!!ountable to t"e people6? but"e ay be reoved ro oi!e only in t"e ode provided bylaw and t"at is by ipea!"ent.69

!. SU!STANTIE

I. Re!ie( o# actual /ases

etitioners aintain t"at 1>17 "as no a!tual basis. en!e,it was not ne!essary or resident 'rroyo to issue su!"ro!laation.

T"e issue o w"et"er t"e Court ay review t"e a!tual baseso t"e residents e*er!ise o "is Coander#in#C"ie power "as rea!"ed its distilled point # ro t"e indulgent days o

arcelon v a8er 7> and 9ontenegro v Castaneda71 to t"e

volatile era o 1ansang v Garcia 77<

+0uino7 4r v Enrile775

and&ar!ia#adilla v. %nrile.7A T"e tug#o#war always !uts a!rosst"e line deining politi!al uestions, parti!ularly t"oseuestions in regard to w"i!" ull dis!retionary aut"ority "as been delegated to t"e legislative or e*e!utive bran!" o t"egovernent.7= arcelon and 9ontenegro were in unison inde!laring t"at t"e %+$ori+ +o (*/i(* $*+$*r %' *5i*'/$%) %ri)*' *lo') +o +$* #r*)i(*'+ and $i) (*/i)io' i) i'%l%'( /o'/l)i6* o' +$* /or+). 1ansang too2 t"e oppositeview. T"ere, t"e ebers o t"e Court were unanious in t"e!onvi!tion t"at t"e Court "as t"e aut"ority to inuire into t"ee*isten!e o a!tual bases in order to deterine t"eir !onstitutional sui!ien!y. Fro& +$* pri'/ipl* o )*p%r%+io'

o po*r), i+ )$i+*( +$* o/) +o +$* ))+*& o /$*/:) %'(%l%'/*), 8'(*r $i/$ +$* #r*)i(*'+ i) )pr*&*, 5 5 5o'l i# %'( (hen $* %/+) i+$i' +$* )p$*r* %llo++*( +o $i& +$* !%)i/ L%, %'( +$* %+$ori+ +o (*+*r&i'* $*+$*ror 'o+ $* $%) )o %/+*( i) 6*)+*( i' +$* J(i/i%l "*p%r+&*'+(hich in this respect , i), i' +r', /o')+i++io'%llsupreme76 In 1975, t"e unanious Court o 1ansang wasdivided in +0uino v Enrile77 T"ere, t"e Court was alostevenly divided on t"e issue o w"et"er t"e validity o t"eiposition o +artial $aw is a politi!al or 3usti!iableuestion.7? T"en !ae Garcia;Padilla v Enrile w"i!" greatlydiluted 1ansang . It de!lared t"at t"ere is a need to re#e*ainet"e latter !ase, ratio!inating t"at i' +i&*) o %r or '%+io'%l*&*r*'/, +$* #r*)i(*'+ &)+ * i6*' %)ol+* /o'+roor +$* 6*r li* o +$* '%+io' %'( +$* o6*r'&*'+ i) i'r*%+ p*ril. T$* #r*)i(*'+, i+ i'+o'*(, i) %')*r%l* o'l +o$i) /o')/i*'/*, +$* #*opl*, %'( Go(.79

T"e Integrated ar o' the Philippines v Jamora?> ## a re!en!ase ost pertinent to t"ese !ases at bar << e!"oed a prin!iplesiilar to 1ansang E"ile t"e Court !onsidered t"e resident!alling#out power as a dis!retionary power solely vested in"is wisdo, it stressed t"at +$i) (o*) 'o+ pr*6*'+ %'*5%&i'%+io' o $*+$*r )/$ po*r %) *5*r/i)*( i+$i'p*r&i))il* /o')+i++io'%l li&i+) or $*+$*r i+ %)*5*r/i)*( i' % &%''*r /o')+i++i' r%6* %)* o(i)/r*+io'.T"is ruling is ainly a result o t"e Courtsrelian!e on e!tion 1, 'rti!le III o 19?7 Constitution w"i!"ortiies t"e aut"ority o t"e !ourts to deterine in anappropriate a!tion t"e validity o t"e a!ts o t"e politi!adepartents. 0nder t"e new deinition o 3udi!ial power, t"e!ourts are aut"oriBed not only to settle a!tual !ontroversiesinvolving rig"ts w"i!" are legally deandable andenor!eable, but also +o (*+*r&i'* $*+$*r or 'o+ +$*r*$%) **' % r%6* %)* o (i)/r*+io' %&o'+i' +o l%/: or*5/*)) o Hri)(i/+io' o' +$* p%r+ o %' r%'/$ or

i')+r&*'+%li+ o +$* o6*r'&*'+. T"e latter part o t"eaut"ority represents a broadening o 3udi!ial power to enablet"e !ourts o 3usti!e to review w"at was beore a orbiddenterritory, to wit, t"e dis!retion o t"e politi!al departents ot"e governent.?1 It spea2s o 3udi!ial prerogative not only inters o po*r but also o (+.?<

's to "ow t"e Court ay inuire into t"e residents e*er!iseo power, 1ansang adopted t"e test t"at 3udi!ial inuiry !an

go no 'urther t"an to satisy t"e Court not t"at t"e residentsde!ision is correct7 but t"at t"e resident did not a!tarbitrarily. T"us, t"e standard laid down is not !orre!tness, but arbitrariness.?5 In Integrated ar o' the Philippines, t"is

Court urt"er ruled t"at i+ i) i'/&*'+ po' +$* p*+i+io'*r+o )$o +$%+ +$* #r*)i(*'+) (*/i)io' i) +o+%ll *r*+ o%/+%l %)i) and t"at i "e ails, by way o proo, to support"is assertion, t"en +$i) Cor+ /%''o+ '(*r+%:* %'i'(*p*'(*'+ i'6*)+i%+io' *o'( +$* pl*%(i').

etitioners ailed to s"ow t"at resident 'rroyos e*er!ise ot"e !alling#out power, by issuing 1>17, is totally beret oa!tual basis. ' reading o t"e oli!itor &enerals ConsolidatedCoent and +eorandu s"ows a detailed narration o t"eevents leading to t"e issuan!e o 1>17, wit" supportingreports oring part o t"e re!ords. +entioned are t"e es!ape























































o t"e +agdalo &roup, t"eir auda!ious t"reat o t"e 9agdalo

D;Day, t"e dee!tions in t"e ilitary, parti!ularly in t"e"ilippine +arines, and t"e reproving stateents ro t"e!ounist leaders. T"ere was also t"e +inutes o t"eIntelligen!e -eport and e!urity &roup o t"e "ilippine'ry s"owing t"e growing allian!e between t"e ' and t"eilitary. etitioners presented not"ing to reute su!" events.T"us, absent any !ontrary allegations, t"e Court is !onvin!edt"at t"e resident was 3ustiied in issuing 1>17 !alling or ilitary aid.

Indeed, 3udging t"e seriousness o t"e in!idents, resident'rroyo was not e*pe!ted to siply old "er ars and donot"ing to prevent or suppress w"at s"e believed was lawlessviolen!e, invasion or rebellion. owever, t"e e*er!ise o su!" power or duty ust not stile liberty.

II. Constitutionality o# PP 0102 and 3.O. &o. 4

"o/+ri'*) o S*6*r%l #oli+i/%l T$*ori)+)o' +$* #o*r o +$* #r*)i(*'+ i' Ti&*) o E&*r*'/

T"is !ase brings to ore a !ontentious sub3e!t ## t"e power o

t"e resident in ties o eergen!y ' glipse at t"e various politi!al t"eories relating to t"is sub3e!t provides an adeuate ba!2drop or our ensuing dis!ussion.

8o"n $o!2e, des!ribing t"e ar!"ite!ture o !ivil governent,!alled upon t"e %nglis" do!trine o prerogative to !ope wit"t"e proble o eergen!y. In ties o danger to t"e nation, positive law ena!ted by t"e legislature ig"t be inadeuate or even a atal obsta!le to t"e proptness o a!tion ne!essary toavert !atastrop"e. In t"ese situations, t"e Crown retained a prerogative po*r +o %/+ %//or(i' +o (i)/r*+io' or +$*pli/ oo(, i+$o+ +$* pro)/rip+io' o +$* l% %'()o&*+i&*) *6*' %%i')+ i+.?A 4ut $o!2e re!ogniBed t"at t"is

oral restraint ig"t not sui!e to avoid abuse o prerogative powers. ;$o )$%ll H(* +$* '**( or r*)or+i' +o +$*pr*ro%+i6* %'( $o &% i+) %)* * %6oi(*(K ere,$o!2e readily aditted deeat, suggesting t"at 8+$* p*opl*$%6* 'o o+$*r r*&*( i' +$i), %) i' %ll o+$*r /%)*) $*r*+$* $%6* 'o H(* o' *%r+$, + +o %pp*%l +o *%6*'.?=

8ean#8a!ues -ousseau also assued t"e need or teporarysuspension o deo!rati! pro!esses o governent in tie o eergen!y. '!!ording to "i:

T"e inle*ibility o t"e laws, w"i!" prevents t"e roadopting t"eselves to !ir!ustan!es, ay, in !ertain !ases,

render t"e disastrous and a2e t"e bring about, at a tieo !risis, t"e ruin o t"e tate

It is wrong t"ereore to wis" to a2e politi!al institutions asstrong as to render it ipossible to suspend t"eir operation.%ven parta allowed its law to lapse...

I t"e peril is o su!" a 2ind t"at t"e parap"ernalia o t"e lawsare an obsta!le to t"eir preservation, t"e et"od is to noinatea supree lawyer, w"o s"all silen!e all t"e laws and suspendor a oent t"e sovereign aut"ority. In su!" a !ase, t"ere is

no doubt about t"e general will, and it !lear t"at t"e peoplesirst intention is t"at t"e tate s"all not peris".?6

-osseau did not ear t"e abuse o t"e eergen!y di!tators"ipor )pr*&* &%i)+r%/ as "e tered it. For "i, it wouldore li2ely be !"eapened by indis!reet use. e wasunwilling to rely upon an %pp*%l +o $*%6*'. Instead, "erelied upon a tenure o oi!e o pres!ribed duration to avoid perpetuation o t"e di!tators"ip.?7

8o"n tuart +ill !on!luded "is ardent deense orepresentative governent: I %& %r ro& /o'(*&'i', i'/%)*) o *5+r*&* '*/*))i+, +$* %))&p+io' o %)ol+*po*r i' +$* or& o % +*&por%r (i/+%+or)$ip.??

i!ollo +a!"iavellis view o eergen!y powers, as oneeleent in t"e w"ole s!"ee o liited governent, urnis"edan ironi! !ontrast to t"e $o!2ean t"eory o prerogative. ere!ogniBed and attepted to bridge t"is !"as in deo!rati! politi!al t"eory, t"us:

ow, in a well#ordered so!iety, it s"ould never be ne!essary to

resort to e*tra M!onstitutional easures; or alt"oug" t"ey ayor a tie be benei!ial, yet t"e pre!edent is perni!ious, or it"e pra!ti!e is on!e establis"ed or good ob3e!ts, t"ey will in alittle w"ile be disregarded under t"at prete*t but or evi purposes. T"us, no republi! will ever be pere!t i s"e "as not by law provided or everyt"ing, "aving a reedy or everyeergen!y and i*ed rules or applying it.?9

+a!"iavelli M in !ontrast to $o!2e, -osseau and +ill M soug"tto in!orporate into t"e !onstitution a regulariBed syste ostandby eergen!y powers to be invo2ed wit" suitable !"e!2sand !ontrols in tie o national danger. e atteptedort"rig"tly to eet t"e proble o !obining a !apa!ious

reserve o power and speed and vigor in its appli!ation in tieo eergen!y, wit" ee!tive !onstitutional restraints.9>

Conteporary politi!al t"eorists, addressing t"eselves to t"e proble o response to eergen!y by !onstitutionadeo!ra!ies, "ave eployed t"e do!trine o !onstitutionadi!tators"ip.91 Frederi!2 +. Eat2ins saw 'o r*%)o' $%)ol+i)& )$ol( 'o+ * )*( %) % &*%') or +$* (**')*o li*r%l i')+i++io'), provided it )*r6*) +o pro+*/*)+%li)$*( i')+i++io') ro& +$* (%'*r o p*r&%'*'i'Hr i' % p*rio( o +*&por%r *&*r*'/ %'( i) ollo*( % pro&p+ r*+r' +o +$* pr*6io) or&) o poli+i/%l li*.9

e re!ogniBed t"e two (<) 2ey eleents o t"e proble o

eergen!y governan!e, as well as all !onstitutionagovernan!e: i'/r*%)i' %(&i'i)+r%+i6* po*r) o +$**5*/+i6*, $il* %+ +$* )%&* +i&* 8i&po)i' li&i+%+io'po' +$%+ po*r.95 Eat2ins pla!ed "is real ait" in a s!"eeo !onstitutional di!tators"ip. T"ese are t"e !onditions osu!!ess o su!" a di!tators"ip: 8T$* p*rio( o (i/+%+or)$ip&)+ * r*l%+i6*l )$or+"i/+%+or)$ip )$ol( %l%) *)+ri/+l l*i+i&%+* i' /$%r%/+*rFi'%l %+$ori+ +o(*+*r&i'* +$* '**( or (i/+%+or)$ip i' %' i6*' /%)* &)+'*6*r r*)+ i+$ +$* (i/+%+or $i&)*l 9A and t"e ob3e!tive osu!" an eergen!y di!tators"ip s"ould be )+ri/+ poli+i/%/o')*r6%+i)&.




























Carl 8. Friedri!" !ast "is analysis in ters siilar to t"ose o Eat2ins.9= It is a proble o !on!entrating power M in agovernent w"ere power "as !ons!iously been divided M to!ope wit" situations o unpre!edented agnitude andgravity. T"ere ust be a broad grant o powers, sub3e!t toeually strong liitations as to w"o s"all e*er!ise su!" powers, w"en, or "ow long, and to w"at end.96 Friedri!",too, oered !riteria or 3udging t"e adeua!y o any o s!"eeo eergen!y powers, to wit: 8T$* *&*r*'/ *5*/+i6*&)+ * %ppoi'+*( /o')+i++io'%l &*%') i.*., $* &)+* l*i+i&%+* $* )$ol( 'o+ *'Ho po*r +o (*+*r&i'* +$**5i)+*'/* o %' *&*r*'/ *&*r*'/ po*r) )$ol( **5*r/i)*( '(*r % )+ri/+ +i&* li&i+%+io' %'( l%)+, +$*oH*/+i6* o *&*r*'/ %/+io' &)+ * +$* (**')* o +$*/o')+i++io'%l or(*r.97

Clinton $. -ossiter, ater surveying t"e "istory o t"eeployent o eergen!y powers in &reat 4ritain, Fran!e,Eeiar, &erany and t"e 0nited tates, reverted to ades!ription o a s!"ee o !onstitutional di!tators"ip assolution to t"e ve*ing probles presented by eergen!y.9?

$i2e Eat2ins and Friedri!", "e stated a priori t"e !onditionso su!!ess o t"e !onstitutional di!tators"ip, t"us:

1@ o general regie or parti!ular institution o !onstitutional di!tators"ip s"ould be initiated unlessit is ne!essary or even indispensable to t"e preservation o t"e tate and its !onstitutionalorder

2@ t"e de!ision to institute a !onstitutionaldi!tators"ip s"ould never be in t"e "ands o t"e anor en w"o will !onstitute t"e di!tator

3@ o governent s"ould initiate a !onstitutional

di!tators"ip wit"out a2ing spe!ii! provisions or its terination

4@ all uses o eergen!y powers and allread3ustents in t"e organiBation o t"e governents"ould be ee!ted in pursuit o !onstitutional or legalreuireents

-@ no di!tatorial institution s"ould be adopted, norig"t invaded, no regular pro!edure altered any oret"an is absolutely ne!essary or t"e !onuest o t"e parti!ular !risis . . .

@ T"e easures adopted in t"e prose!ution o t"e a!onstitutional di!tators"ip s"ould never be peranentin !"ara!ter or ee!t

7@ T"e di!tators"ip s"ould be !arried on by personsrepresentative o every part o t"e !itiBenry interestedin t"e deense o t"e e*isting !onstitutional order. . .

@ 0ltiate responsibility s"ould be aintained or every a!tion ta2en under a !onstitutional di!tators"ip.. .

9@ T"e de!ision to terinate a !onstitutionadi!tators"ip, li2e t"e de!ision to institute one s"ouldnever be in t"e "ands o t"e an or en w"o!onstitute t"e di!tator. . .

10@ o !onstitutional di!tators"ip s"ould e*tend beyond t"e terination o t"e !risis or w"i!" it wasinstituted

11@ t"e terination o t"e !risis ust be ollowed by a !oplete return as possible to t"e politi!al andgovernental !onditions e*isting prior to t"einitiation o t"e !onstitutional di!tators"ip99

-ossiter a!!orded to legislature a ar greater role in t"eoversig"t e*er!ise o eergen!y powers t"an did Eat2ins. ewould se!ure to Congress inal responsibility or de!laring t"ee*isten!e or terination o an eergen!y, and "e pla!es greatait" in t"e ee!tiveness o !ongressional investigating!oittees.1>>

Scott and Cotter , in analyBing t"e above !onteporary

t"eories in lig"t o re!ent e*perien!e, were one in saying t"at,+$* )*)+io' +$%+ (*&o/r%/i*) )rr*'(*r +$* /o'+rol oo6*r'&*'+ +o %' %+$ori+%ri%' rl*r i' +i&* o r%6*(%'*r +o +$* '%+io' i) not %)*( po' )o'( /o')+i++io'%+$*or. To appraise eergen!y power in ters o!onstitutional di!tators"ip serves erely to distort t"e probleand "inder realisti! analysis. It atters not w"et"er t"e terdi!tator is used in its noral sense (as applied toaut"oritarian rulers) or is eployed to ebra!e all !"iee*e!utives adinistering eergen!y powers. owever used!onstitutional di!tators"ip !annot be divor!ed ro t"eipli!ation o suspension o t"e pro!esses o!onstitutionalis. T"us, t"ey avored instead t"e !on!ept o

!onstitutionalis arti!ulated by C"arles . +!Ilwain:

' !on!ept o !onstitutionalis w"i!" is less isleading in t"eanalysis o probles o eergen!y powers, and w"i!" is!onsistent wit" t"e indings o t"is study, is t"at orulated byC"arles . +!Ilwain. E"ile it does not by any eansne!essarily e*!lude soe indeterinate liitations upon t"esubstantive powers o governent, ull ep"asis is pla!edupon pro/*(r%l li&i+%+io'), a nd poli+i/%l r*)po')iili++!Ilwain !learly re!ogniBed t"e need to repose adeuate power in governent. 'nd in dis!ussing t"e eaning o!onstitutionalis, "e insisted t"at t"e $i)+ori/%l %'( prop*r+*)+ o /o')+i++io'%li)& %) +$* *5i)+*'/* o %(*%+*

pro/*))*) or :**pi' o6*r'&*'+ r*)po')il*. e reusedto euate !onstitutionalis wit" t"e eneebling o governent by an e*aggerated ep"asis upon separation o powers andsubstantive liitations on governental power. e ound t"att"e really ee!tive !"e!2s on despotis "ave !onsisted not int"e wea2ening o governent but, but rat"er in t"e li&i+i' oi+; between w"i!" t"ere is a great and very signii!andieren!e. I' %))o/i%+i' /o')+i++io'%li)& i+$ 8li&i+*(8%) (i)+i'i)$*( ro& 8*%:8 o6*r'&*'+, M/Il%i'&*%'+ o6*r'&*'+ li&i+*( +o +$* or(*rl pro/*(r* o l%%) oppo)*( +o +$* pro/*))*) o or/*. T$* +o '(%&*'+%l/orr*l%+i6* *l*&*'+) o /o')+i++io'%li)& or $i/$ %llo6*r) o li*r+ &)+ *+ i$+ %r* +$* l*%l li&i+) +o

















%ri+r%r po*r %'( % /o&pl*+* poli+i/%l r*)po')iili+ o o6*r'&*'+ +o +$* o6*r'*(.1>1

In t"e inal analysis, t"e various approa!"es to eergen!y o t"e above politi!al t"eorists M# ro $o!2s t"eory o prerogative, to Eat2ins do!trine o !onstitutionaldi!tators"ip and, eventually, to +!Ilwains prin!iple o !onstitutionalis ### ultiately ai to solve one real problein eergen!y governan!e, i.e., +$%+ o %llo++i' i'/r*%)i'

%r*%) o (i)/r*+io'%r po*r +o +$* C$i* E5*/+i6*, $il*i')ri' +$%+ )/$ po*r) ill * *5*r/i)*( i+$ % )*')* o poli+i/%l r*)po')iili+ %'( '(*r **/+i6* li&i+%+io') %'(/$*/:).

Our Constitution "as airly !oped wit" t"is proble. Fres"ro t"e etters o a repressive regie, t"e 19?6 ConstitutionalCoission, in drating t"e 19?7 Constitution, endeavored to!reate a governent in t"e !on!ept o 8usti!e 8a!2sonsbalan!ed power stru!ture.1>< %*e!utive, legislative, and 3udi!ial powers are dispersed to t"e resident, t"e Congress,and t"e upree Court, respe!tively. %a!" is supree wit"inits own sp"ere. !+ 'o'* $%) +$* &o'opol o po*r i'+i&*) o *&*r*'/. E%/$ r%'/$ i) i6*' % rol* +o )*r6* %)li&i+%+io' or /$*/: po' +$* o+$*r. T"is syste does not*%:*' t"e resident, it 3ust li&i+) "is power, using t"elanguage o +!Ilwain. In ot"er words, in ties o eergen!y,our Constitution reasonably deands t"at we repose a !ertainaount o ait" in t"e basi! integrity and wisdo o t"e C"ie %*e!utive but, at t"e sae tie, i+ oli*) $i& +o op*r%+*i+$i' /%r*ll pr*)/ri*( pro/*(r%l li&i+%+io').

%. 8F%/i%l C$%ll*'*8

etitioners !ontend t"at 1>17 is void on its a!e be!ause o its overbreadt". T"ey !lai t"at its enor!eent en!roa!"ed

on bot" unprote!ted and prote!ted rig"ts under e!tion A,'rti!le III o t"e Constitution and sent a !"illing ee!t to t"e!itiBens.

' a!ial review o 1>17, using t"e overbreadt" do!trine, isun!alled or.

First and 'oremost , t"e overbreadt" do!trine is an analyti!altool developed or testing on t"eir a!es statutes in r**)p**/$ /%)*), also 2nown under t"e 'eri!an $aw as First'endent !ases.1>5

' plain reading o 1>17 s"ows t"at it is not priarily

dire!ted to spee!" or even spee!"#related !ondu!t. It isa!tually a !all upon t"e 'F to prevent or suppress all orso l%l*)) 6iol*'/*. In 3nited States v Salerno,1>A t"e 0upree Court "eld t"at * $%6* 'o+ r*/o'i*( %'o6*rr*%(+$ (o/+ri'* o+)i(* +$* li&i+*( /o'+*5+ o +$*Fir)+ A&*'(&*'+8 ?r**(o& o )p**/$@.

+oreover, t"e overbreadt" do!trine is not intended or testingt"e validity o a law t"at rele!ts legitiate state interest inaintaining !opre"ensive !ontrol over "arul,!onstitutionally unprote!ted !ondu!t. 0ndoubtedly, lawlessviolen!e, insurre!tion and rebellion are !onsidered "arul

and !onstitutionally unprote!ted !ondu!t. In roadric8 v

O8lahoma71>= it was "eld:

It reains a Satter o no little dii!ulty to deterine w"en alaw ay properly be "eld void on its a!e and w"en Ssu!"suary a!tion is inappropriate. !+ +$* pl%i' i&por+ oor /%)*) i), %+ +$* 6*r l*%)+, +$%+ %/i%l o6*rr*%(+$%(H(i/%+io' i) %' *5/*p+io' +o or +r%(i+io'%l rl*) opr%/+i/* %'( +$%+ i+) '/+io', % li&i+*( o'* %+ +$* o+)*+

%++*'%+*) %) +$* o+$*ri)* 'pro+*/+*( *$%6ior +$%+ i+ori() +$* S+%+* +o )%'/+io' &o6*) ro& pr* )p**/$+o%r( /o'(/+ and +$%+ /o'(/+ *6*' i *5pr*))i6* %ll)i+$i' +$* )/op* o o+$*ri)* 6%li( /ri&i'%l l%) +$%+r*l*/+ l*i+i&%+* )+%+* i'+*r*)+) i' &%i'+%i'i'/o&pr*$*')i6* /o'+rol) o6*r $%r&l, /o')+i++io'%ll'pro+*/+*( /o'(/+.

T"us, !lais o a!ial overbreadt" are entertained in !asesinvolving statutes w"i!", +$*ir +*r&), see2 to regulate only)po:*' or() and again, t"at o6*rr*%(+$ /l%i&), i*'+*r+%i'*( %+ %ll, $%6* **' /r+%il*( $*' i'6o:*(%%i')+ or(i'%r /ri&i'%l l%) +$%+ %r* )o$+ +o *%ppli*( +o pro+*/+*( /o'(/+.1>6 ere, t"e in!ontrovertiblea!t reains t"at 1>17 pertains to a spe!tru o /o'(/+not ree spee!", w"i!" is aniestly sub3e!t to state regulation

Second7 a!ial invalidation o laws is !onsidered a&%'i*)+l )+ro' &*(i/i'*, to be used )p%ri'l %'(o'l %) % l%)+ r*)or+, and is *'*r%ll (i)%6or*(;1>7 T"ereason or t"is is obvious. %bedded in t"e traditional rulesgoverning !onstitutional ad3udi!ation is t"e prin!iple t"at a person to w"o a law ay be applied will not be "eard to!"allenge a law on t"e ground t"at it ay !on!eivably beapplied un!onstitutionally to ot"ers, i.e., i' o+$*r )i+%+io')'o+ *or* +$* Cor+.1>? ' writer and s!"olar in Constitutiona$aw e*plains urt"er:

T$* &o)+ (i)+i'/+i6* *%+r* o +$* o6*rr*%(+$ +*/$'i*i) +$%+ i+ &%r:) %' *5/*p+io' +o )o&* o +$* )%l rl*) o/o')+i++io'%l li+i%+io'. Or(i'%ril, % p%r+i/l%r li+i%'+/l%i&) +$%+ % )+%++* i) '/o')+i++io'%l %) %ppli*( +o $i&or $*r i +$* li+i%'+ pr*6%il), +$* /or+) /%r6* %% +$*'/o')+i++io'%l %)p*/+) o +$* l% i'6%li(%+i' i+)i&prop*r %ppli/%+io') o' % /%)* +o /%)* %)i). Mor*o6*r,/$%ll*'*r) +o % l% %r* 'o+ p*r&i++*( +o r%i)* +$* ri$+) o+$ir( p%r+i*) %'( /%' o'l %))*r+ +$*ir o' i'+*r*)+). I'o6*rr*%(+$ %'%l)i), +$o)* rl*) i6* % /$%ll*'*) %r*p*r&i++*( +o r%i)* +$* ri$+) o +$ir( p%r+i*); and t"e !ourinvalidates t"e entire statute on its a!e, not erely asapplied or so t"at t"e overbroad law be!oes unenor!eableuntil a properly aut"oriBed !ourt !onstrues it ore narrowlyT"e a!tor t"at otivates !ourts to depart ro t"e noralad3udi!atory rules is t"e !on!ern wit" t"e !"illing; deterrentee!t o t"e overbroad statute on t"ird parties not !ourageousenoug" to bring suit. T"e Court assues t"at an overbroadlaws very e*isten!e ay !ause ot"ers not beore t"e !ourt torerain ro !onstitutionally prote!ted spee!" or e*pression.'n overbreadt" ruling is designed to reove t"at deterrentee!t on t"e spee!" o t"ose t"ird parties.

























In ot"er words, a a!ial !"allenge using t"e overbreadt"do!trine will reuire t"e Court to e*aine 1>17 and pinpoint its laws and dee!ts, not on t"e basis o its a!tualoperation to petitioners, but on t"e assuption or predi!tiont"at its very e*isten!e ay !ause o+$*r) 'o+ *or* +$* Cor+to rerain ro !onstitutionally prote!ted spee!" or e*pression.In Lounger v 6arris,1>9 it was "eld t"at:

JTK"e tas2 o analyBing a proposed statute, pinpointing its

dei!ien!ies, and reuiring !orre!tion o t"ese dei!ien!ies beore t"e statute is put into ee!t, is rarely i ever anappropriate tas2 or t"e 3udi!iary. T"e !obination o t"er*l%+i6* r*&o+*'*)) o +$* /o'+ro6*r), t"e i&p%/+ o' +$*l*i)l%+i6* pro/*)) o +$* r*li* )o$+, and above all +$*)p*/l%+i6* %'( %&orp$o) '%+r* o +$* r*ir*( li'*<<li'* %'%l)i) o (*+%il*( )+%++*),...ordinarily results in a 2indo !ase t"at is $oll ')%+i)%/+or or de!iding!onstitutional uestions, w"i!"ever way t"ey ig"t bede!ided.

'nd third7 a a!ial !"allenge on t"e ground o overbreadt" ist"e ost dii!ult !"allenge to ount su!!essully, sin!e t"e!"allenger ust establis" t"at +$*r* /%' * 'o i')+%'/* $*'+$* %))%il*( l% &% * 6%li(. ere, petitioners did not evenattept to s"ow w"et"er t"is situation e*ists.

etitioners li2ewise see2 a a!ial review o 1>17 on t"eground o vagueness. T"is, too, is unwarranted.

-elated to t"e overbreadt" do!trine is t"e void or vagueness do!trine w"i!" "olds t"at % l% i) %/i%lli'6%li( i &*' o /o&&o' i'+*lli*'/* &)+ '*/*))%ril*)) %+ i+) &*%'i' %'( (i*r %) +o i+) %ppli/%+io'.11> It issub3e!t to t"e sae prin!iples governing overbreadt" do!trine.For one, it is also an analyti!al tool or testing on t"eir a!es

)+%++*) i' r** )p**/$ /%)*). 'nd li2e overbreadt", it is saidt"at a litigant ay !"allenge a statute on its a!e only i it is6%* i' %ll i+) po))il* %ppli/%+io'). A%i', p*+i+io'*r) (i('o+ *6*' %++*&p+ +o )$o +$%+ ## 1017 i) 6%* i' %ll i+)%ppli/%+io'. T"ey also ailed to establis" t"at en o !oonintelligen!e !annot understand t"e eaning and appli!ation o 1>17.

. Co')+i++io'%l !%)i) o ## 1017

ow on t"e !onstitutional oundation o 1>17.

T"e operative portion o 1>17 ay be divided into t"ree

iportant provisions, t"us:

irst pro!ision:

by virtue o t"e power vested upon e by e!tion 1?, 'rtil!eII do "ereby !oand t"e 'red For!es o t"e"ilippines, to aintain law and order t"roug"out t"e"ilippines, prevent or suppress all ors o lawless violen!eas well any a!t o insurre!tion or rebellion

+econd pro!ision:

and to enor!e obedien!e to all t"e laws and to all de!rees,orders and regulations proulgated by e personally or upony dire!tion;

Third pro!ision:

as provided in e!tion 17, 'rti!le /II o t"e Constitution do"ereby de!lare a tate o ational %ergen!y.

irst Pro!ision: Callin*out Po(er

T"e irst provision pertains to t"e residents !alling#ou power. In Sanla8as v E%ecutive Secretary,111 t"is Courtt"roug" +r. 8usti!e ante O. Tinga, "eld t"at e!tion 1?'rti!le II o t"e Constitution reprodu!ed as ollows:

S*/. 1. T"e resident s"all be t"e Coander#in#C"ie o allared or!es o t"e "ilippines and $*'*6*r i+ */o&*)'*/*))%r, $* &% /%ll o+ )/$ %r&*( or/*) +o pr*6*'+ or)ppr*)) l%l*)) 6iol*'/*, i'6%)io' or r**llio'. In !ase oinvasion or rebellion, w"en t"e publi! saety reuires it, "eay, or a period not e*!eeding si*ty days, suspend t"e

privilege o t"e writ o habeas corpus or pla!e t"e "ilippinesor any part t"ereo under artial law. Eit"in orty#eig"t "oursro t"e pro!laation o artial law or t"e suspension o t"e privilege o t"e writ o habeas corpus, t"e resident s"alsubit a report in person or in writing to t"e Congress. T"eCongress, voting 3ointly, by a vote o at least a a3ority o allits +ebers in regular or spe!ial session, ay revo2e su!" pro!laation or suspension, w"i!" revo!ation s"all not be setaside by t"e resident. 0pon t"e initiative o t"e resident, t"eCongress ay, in t"e sae anner, e*tend su!" pro!laationor suspension or a period to be deterined by t"e Congress, it"e invasion or rebellion s"all persist and publi! saetyreuires it.

T"e Congress, i not in session, s"all wit"in twenty#our "oursollowing su!" pro!laation or suspension, !onvene ina!!ordan!e wit" its rules wit"out need o a !all.

T"e upree Court ay review, in an appropriate pro!eedingiled by any !itiBen, t"e sui!ien!y o t"e a!tual bases o t"e pro!laation o artial law or t"e suspension o t"e privilegeo t"e writ or t"e e*tension t"ereo, and ust proulgate itsde!ision t"ereon wit"in t"irty days ro its iling.

' state o artial law does not suspend t"e operation o t"eConstitution, nor supplant t"e un!tioning o t"e !ivil !ourts or

legislative asseblies, nor aut"oriBe t"e !onerent o 3urisdi!tion on ilitary !ourts and agen!ies over !iviliansw"ere !ivil !ourts are able to un!tion, nor autoati!allysuspend t"e privilege o t"e writ.

T"e suspension o t"e privilege o t"e writ s"all apply only to persons 3udi!ially !"arged or rebellion or oenses in"erent inor dire!tly !onne!ted wit" invasion.

uring t"e suspension o t"e privilege o t"e writ, any persont"us arrested or detained s"all be 3udi!ially !"arged wit"int"ree days, ot"erwise "e s"all be released.












grants t"e resident, as Coander#in#C"ie, a seuen!e o graduated powers. Fro t"e ost to t"e least benign, t"eseare: t"e !alling#out power, t"e power to suspend t"e privilegeo t"e writ o habeas corpus, and t"e power to de!lare +artial$aw. Citing Integrated ar o' the Philippines v Jamora,11< t"eCourt ruled t"at t"e only !riterion or t"e e*er!ise o t"e!alling#out power is t"at $*'*6*r i+ */o&*) '*/*))%r,t"e resident ay !all t"e ared or!es +o pr*6*'+ or)ppr*)) l%l*)) 6iol*'/*, i'6%)io' or r**llio'. +re these

conditions present in the instant casesP 's stated earlier,!onsidering t"e !ir!ustan!es t"en prevailing, resident'rroyo ound it ne!essary to issue 1>17. Owing to "er Oi!es vast intelligen!e networ2, s"e is in t"e best position todeterine t"e a!tual !ondition o t"e !ountry.

0nder t"e !alling#out power, t"e resident ay suon t"eared or!es to aid "i in suppressing l%l*)) 6iol*'/*,i'6%)io' %'( r**llio'. T"is involves ordinary poli!e a!tion.4ut every a!t t"at goes beyond t"e residents !alling#out power is !onsidered illegal or ultra vires. For t"is reason, aresident ust be !areul in t"e e*er!ise o "is powers. e!annot invo2e a greater power w"en "e wis"es to a!t under alesser power. T"ere lies t"e wisdo o our Constitution, t"e

greater t"e power, t"e greater are t"e liitations.

It is pertinent to state, "owever, t"at t"ere is a distin!tion between t"e residents aut"ority to de!lare a state o rebellion (in Sanla8as) and t"e aut"ority to pro!lai a stateo national eergen!y. E"ile resident 'rroyos aut"ority tode!lare a state o rebellion eanates ro "er powers asC"ie %*e!utive, t"e statutory aut"ority !ited in Sanla8as wase!tion A, C"apter <, 4oo2 II o t"e -evised 'dinistrativeCode o 19?7, w"i!" provides:

%C. A. M ro!laations. M '!ts o t"e resident i*ing a dateor de!laring a status or !ondition o publi! oent or interest,upon t"e e*isten!e o w"i!" t"e operation o a spe!ii! law or regulation is ade to depend, s"all be proulgated in pro!laations w"i!" s"all "ave t"e or!e o an e*e!utiveorder.

resident 'rroyos de!laration o a state o rebellion waserely an a!t de!laring a status or !ondition o publi! oentor interest, a de!laration allowed under e!tion A !ited above.u!" de!laration, in t"e words o Sanla8as, is "arless,wit"out legal signii!an!e, and deeed not written. In t"ese!ases, 1>17 is ore t"an t"at. In de!laring a state o national eergen!y, resident 'rroyo did not only rely one!tion 1?, 'rti!le II o t"e Constitution, a provision !allingon t"e 'F to prevent or suppress lawless violen!e, invasionor rebellion. "e also relied on e!tion 17, 'rti!le /II, a provision on t"e tates e*traordinary power to ta2e over privately#owned publi! utility and business ae!ted wit" publi! interest. Indeed, 1>17 !alls or t"e e*er!ise o an%*)o&* po*r. Obviously, su!" ro!laation !annot bedeeed "arless, wit"out legal signii!an!e, or not written, asin t"e !ase o Sanla8as.

oe o t"e petitioners ve"eently aintain t"at 1>17 isa!tually a de!laration o +artial $aw. It is no so. E"at deines

t"e !"ara!ter o 1>17 are its wordings. It is plain t"ereint"at w"at t"e resident invo2ed was "er !alling#out power.

T"e de!laration o +artial $aw is a warnJingK to !itiBens t"att"e ilitary power "as been !alled upon by t"e e*e!utive toassist in t"e aintenan!e o law and order, and t"at, w"ile t"eeergen!y lasts, t"ey ust, upon pain o arrest and punis"ent, not !oit any a!ts w"i!" will in any way renderore dii!ult t"e restoration o order and t"e enor!eent o

law.

115

In "is Statement be'ore the Senate Committee on 4ustice on+ar!" 15, <>>6, +r. 8usti!e i!ente . +endoBa,11A anaut"ority in !onstitutional law, said t"at o t"e t"ree powers ot"e resident as Coander#in#C"ie, t"e power to de!lare+artial $aw poses t"e ost severe t"reat to !ivil liberties. It isa strong edi!ine w"i!" s"ould not be resorted to lig"tly. It!annot be used to stile or perse!ute !riti!s o t"e governentIt is pla!ed in t"e 2eeping o t"e resident or t"e purpose oenabling "i to se!ure t"e people ro "ar and to restoreorder so t"at t"ey !an en3oy t"eir individual reedos. In a!t,e!tion 1?, 'rt. II, provides:

' state o artial law does not suspend t"e operation o t"eConstitution, nor supplant t"e un!tioning o t"e !ivil !ourts orlegislative asseblies, nor aut"oriBe t"e !onerent o 3urisdi!tion on ilitary !ourts and agen!ies over !iviliansw"ere !ivil !ourts are able to un!tion, nor autoati!allysuspend t"e privilege o t"e writ.

8usti!e +endoBa also stated t"at 1>17 is not a de!larationo +artial $aw. It is no ore t"an a !all by t"e resident to t"eared or!es to prevent or suppress lawless violen!e. 's su!",it !annot be used to 3ustiy a!ts t"at only under a validde!laration o +artial $aw !an be done. Its use or any ot"er

purpose is a perversion o its nature and s!ope, and any a!done !ontrary to its !oand is ultra vires.

8usti!e +endoBa urt"er stated t"at spe!ii!ally, (a) arrests andseiBures wit"out 3udi!ial warrants; (b) ban on publi!asseblies; (!) ta2e#over o news edia and agen!ies and press !ensors"ip; and (d) issuan!e o residential e!rees, are powers w"i!" !an be e*er!ised by t"e resident asCoander#in#C"ie o'l w"ere t"ere is a valid de!larationo +artial $aw or suspension o t"e writ o habeas corpus.

4ased on t"e above disuisition, it is !lear t"at 1>17 is nota de!laration o +artial $aw. I+ i) &*r*l %' *5*r/i)* o

#r*)i(*'+ Arroo) /%lli'<o+ po*r or t"e ared or!es toassist "er in preventing or suppressing lawless violen!e.

+econd Pro!ision: 5Ta6e Care5 Po(er

T"e se!ond provision pertains to t"e power o t"e resident toensure t"at t"e laws be ait"ully e*e!uted. T"is is based one!tion 17, 'rti!le II w"i!" reads:

SEC. 17. T"e resident s"all "ave !ontrol o all t"e e*e!utivedepartents, bureaus, and oi!es. * )$%ll *')r* +$%+ +$*l%) * %i+$ll *5*/+*(.










's t"e %*e!utive in w"o t"e e*e!utive power is vested, 11=

t"e priary un!tion o t"e resident is to enor!e t"e laws aswell as to orulate poli!ies to be ebodied in e*isting laws.e sees to it t"at all laws are enor!ed by t"e oi!ials andeployees o "is departent. 4eore assuing oi!e, "e isreuired to ta2e an oat" or airation to t"e ee!t t"at asresident o t"e "ilippines, "e will, aong ot"ers, e*e!uteits laws.116 In t"e e*er!ise o su!" un!tion, t"e resident, i needed, ay eploy t"e powers atta!"ed to "is oi!e as t"eCoander#in#C"ie o all t"e ared or!es o t"e !ountry, 117

in!luding t"e "ilippine ational oli!e11? under t"eepartent o Interior and $o!al &overnent.119

etitioners, espe!ially -epresentatives Fran!is 8osep" &.%s!udero, atur O!apo, -aael +ariano, Teodoro CasiRo,$iBa +aBa, and 8osel irador argue t"at 1>17 isun!onstitutional as it arrogated upon resident 'rroyo t"e power to ena!t laws and de!rees in violation o e!tion 1,'rti!le I o t"e Constitution, w"i!" vests t"e power to ena!tlaws in Congress. T"ey assail t"e !lause +o *'or/*o*(i*'/* +o %ll +$* l%) %'( +o %ll (*/r**), or(*r) %'(r*l%+io') pro&l%+*( &* p*r)o'%ll or po' &(ir*/+io'.

U

etitioners !ontention is understandable. ' reading o 1>17 operative !lause s"ows t"at it was lited1<> ro Forer resident +ar!os ro!laation o. 1>?1, w"i!" partly reads:

NO;, TEREFORE, I, FER"INAN" E. MARCOS,resident o t"e "ilippines by virtue o t"e powers vestedupon e by 'rti!le II, e!tion 1>, aragrap" (<) o t"eConstitution, do "ereby pla!e t"e entire "ilippines as deinedin 'rti!le 1, e!tion 1 o t"e Constitution under artial law

and, in y !apa!ity as t"eir Coander#in#C"ie, (o $*r*/o&&%'( +$* Ar&*( For/*) o +$* #$ilippi'*), +o &%i'+%i'l% %'( or(*r +$ro$o+ +$* #$ilippi'*), pr*6*'+ or)ppr*)) %ll or&) o l%l*)) 6iol*'/* %) *ll %) %' %/+ o i')rr*/+io' or r**llio' %'( +o *'or/* o*(i*'/* +o %ll +$*l%) %'( (*/r**), or(*r) %'( r*l%+io') pro&l%+*( &* p*r)o'%ll or po' & (ir*/+io'.

Ee all 2now t"at it was 1>?1 w"i!" granted resident+ar!os legislative power. Its enabling !lause states: 8+o*'or/* o*(i*'/* +o %ll +$* l%) %'( (*/r**), or(*r) %'(r*l%+io') pro&l%+*( &* p*r)o'%ll or po' &(ir*/+io'.8 0pon t"e ot"er "and, t"e enabling !lause o

1>17 issued by resident 'rroyo is: +o *'or/* o*(i*'/* +o%ll +$* l%) %'( to all (*/r**), or(*r) %'( r*l%+io')pro&l%+*( &* p*r)o'%ll or po' & (ir*/+io'.

Is it $ithin the domain o' President +rroyo to promulgate@ decrees@M

1>17 states in part: to enor!e obedien!e to all t"e lawsand (*/r**) * * * pro&l%+*( &* p*r)o'%ll or po'& (ir*/+io'.

T"e resident is granted an Ordinan!e ower under C"apter <4oo2 III o %*e!utive Order o. <9< ('dinistrative Code o19?7). "e ay issue any o t"e ollowing:

e!. <. E%ecutive Orders. @ '!ts o t"e resident providingor rules o a general or peranent !"ara!ter inipleentation or e*e!ution o !onstitutional or statutory powers s"all be proulgated in e*e!utive orders.

e!. 5. +dministrative Orders. @ '!ts o t"e resident w"i!"relate to parti!ular aspe!t o governental operations in pursuan!e o "is duties as adinistrative "ead s"all be proulgated in adinistrative orders.

e!. A. Proclamations. @ '!ts o t"e resident i*ing a date orde!laring a status or !ondition o publi! oent or interestupon t"e e*isten!e o w"i!" t"e operation o a spe!ii! law orregulation is ade to depend, s"all be proulgated in pro!laations w"i!" s"all "ave t"e or!e o an e*e!utiveorder.

e!. =. 9emorandum Orders. @ '!ts o t"e resident on

atters o adinistrative detail or o subordinate or teporaryinterest w"i!" only !on!ern a parti!ular oi!er or oi!e o t"e&overnent s"all be ebodied in eorandu orders.

e!. 6. 9emorandum Circulars. @ '!ts o t"e resident onatters relating to internal adinistration, w"i!" t"e residentdesires to bring to t"e attention o all or soe o t"edepartents, agen!ies, bureaus or oi!es o t"e &overnentor inoration or !oplian!e, s"all be ebodied ineorandu !ir!ulars.

e!. 7. General or Special Orders. @ '!ts and !oands ot"e resident in "is !apa!ity as Coander#in#C"ie o t"e

'red For!es o t"e "ilippines s"all be issued as general orspe!ial orders.

resident 'rroyos ordinan!e power is liited to t"e oregoingissuan!es. "e !annot issue (*/r**) siilar to t"ose issued byForer resident +ar!os under 1>?1. residential e!reesare laws w"i!" are o t"e sae !ategory and binding or!e asstatutes be!ause t"ey were issued by t"e resident in t"ee*er!ise o "is legislative power during t"e period o +artia$aw under t"e 1975 Constitution.1<1

T$i) Cor+ rl*) +$%+ +$* %))%il*( ## 1017 i)'/o')+i++io'%l i')o%r %) i+ r%'+) #r*)i(*'+ Arroo +$*

%+$ori+ +o pro&l%+* 8(*/r**).8 $egislative power is pe!uliarly wit"in t"e provin!e o t"e $egislature. e!tion 1'rti!le I !ategori!ally states t"at +P$* l*i)l%+i6* po*r)$%ll * 6*)+*( i' +$* Co'r*)) o +$* #$ilippi'*) $i/$)$%ll /o')i)+ o % S*'%+* %'( % o)* o R*pr*)*'+%+i6*) .To be sure, neit"er +artial $aw nor a state o rebellion nor astate o eergen!y !an 3ustiy resident 'rroyos e*er!ise olegislative power by issuing de!rees.

Can President +rroyo en'orce obedience to all decrees andla$s through the militaryP





















's t"is Court stated earlier, resident 'rroyo "as no aut"orityto ena!t de!rees. It ollows t"at t"ese de!rees are void and,t"ereore, !annot be enor!ed. Eit" respe!t to laws, s"e!annot !all t"e ilitary to enor!e or ipleent !ertain laws,su!" as !ustos laws, laws governing aily and propertyrelations, laws on obligations and !ontra!ts and t"e li2e. "e!an only order t"e ilitary, under 1>17, to enor!e laws pertinent to its duty +o )ppr*)) l%l*)) 6iol*'/*.

Third Pro!ision: Po(er to Ta6e O!er

T"e pertinent provision o 1>17 states:

* * * and to enor!e obedien!e to all t"e laws and to allde!rees, orders, and regulations proulgated by e personallyor upon y dire!tion; %'( %) pro6i(*( i' S*/+io' 17, Ar+i/l*II o +$* Co')+i++io' (o $*r* (*/l%r* % )+%+* o '%+io'%l *&*r*'/.

T"e iport o t"is provision is t"at resident 'rroyo, duringt"e state o national eergen!y under 1>17, !an !all t"eilitary not only to enor!e obedien!e to all t"e laws and to

all de!rees * * * but also to a!t pursuant to t"e provision o e!tion 17, 'rti!le /II w"i!" reads:

S*/. 17. In ties o national eergen!y, w"en t"e publi!interest so reuires, t"e tate ay, during t"e eergen!y andunder reasonable ters pres!ribed by it, teporarily ta2e over or dire!t t"e operation o any privately#owned publi! utility or business ae!ted wit" publi! interest.

hat could be the reason o' President +rroyo in invo8ing the

above provision $hen she issued PP ">"M

T"e answer is siple. uring t"e e*isten!e o t"e state o

national eergen!y, 1>17 purports to grant t"e resident,wit"out any aut"ority or delegation ro Congress, to ta2eover or dire!t t"e operation o any privately#owned publi!utility or business ae!ted wit" publi! interest.

T"is provision was irst introdu!ed in t"e 1975 Constitution,as a produ!t o t"e artial law t"in2ing o t"e 1971Constitutional Convention.1<< In ee!t at t"e tie o itsapproval was resident +ar!os $etter o Instru!tion o. <dated epteber <<, 197< instru!ting t"e e!retary o ational eense to ta2e over the management7 control and

operation o' the 9anila Electric Company7 the Philippine

1ong Distance !elephone Company7 the 5ational ater$or8s

and Se$erage +uthority7 the Philippine 5ational Rail$ays7the Philippine +ir 1ines7 +ir 9anila *and, Filipinas Orient

+ir$ays 'or the success'ul prosecution by the Government

o' its e''ort to contain7 solve and end the present national emergency

etitioners, parti!ularly t"e ebers o t"e ouse o -epresentatives, !lai t"at resident 'rroyos in!lusion o e!tion 17, 'rti!le /II in 1>17 is an en!roa!"ent on t"elegislatures eergen!y powers.

T"is is an area t"at needs delineation.

' distin!tion ust be drawn between t"e residents aut"orityto (*/l%r* a state o national eergen!y and to *5*r/i)*eergen!y powers. To t"e irst, as elu!idated by t"e Court,e!tion 1?, 'rti!le II grants t"e resident su!" power, "en!eno legitiate !onstitutional ob3e!tion !an be raised. 4ut to t"ese!ond, aniold !onstitutional issues arise.

e!tion <5, 'rti!le I o t"e Constitution reads:

SEC. 23. ?1@ T"e Congress, by a vote o two#t"irds o bot"ouses in 3oint session assebled, voting separately, s"al"ave t"e )ol* po*r +o (*/l%r* +$* *5i)+*'/* o % )+%+* o%r.

?2@ In ties o war or o+$*r '%+io'%l *&*r*'/, t"eCongress ay, by law, aut"oriBe t"e resident, or a liited period and sub3e!t to su!" restri!tions as it ay pres!ribe, toe*er!ise powers ne!essary and proper to !arry out a de!larednational poli!y. 0nless sooner wit"drawn by resolution o t"eCongress, su!" powers s"all !ease upon t"e ne*t ad3ournentt"ereo.

It ay be pointed out t"at t"e se!ond paragrap" o t"e above provision reers not only to war but also to o+$*r '%+io'%*&*r*'/. I t"e intention o t"e Fraers o ourConstitution was to wit""old ro t"e resident t"e aut"orityto de!lare a state o national eergen!y pursuant to e!tion1?, 'rti!le II (!alling#out power) and grant it to Congress(li2e t"e de!laration o t"e e*isten!e o a state o war), t"ent"e Fraers !ould "ave provided so. Clearly, t"ey did nointend t"at Congress s"ould irst aut"oriBe t"e residen beore "e !an de!lare a state o national eergen!y. T"elogi!al !on!lusion t"en is t"at resident 'rroyo !ould validlyde!lare t"e e*isten!e o a state o national eergen!y even int"e absen!e o a Congressional ena!tent.

4ut t"e *5*r/i)* o eergen!y powers, su!" as t"e ta2ing overo privately owned publi! utility or business ae!ted wit" publi! interest, is a dierent atter. T"is reuires a delegationro Congress.

Courts "ave oten said t"at !onstitutional provisions in par

materia are to be !onstrued toget"er. Ot"erwise stateddierent !lauses, se!tions, and provisions o a !onstitutionw"i!" relate to t"e sae sub3e!t atter will be !onstruedtoget"er and !onsidered in t"e lig"t o ea!" ot"er.1<

Considering t"at e!tion 17 o 'rti!le /II and e!tion <5 o'rti!le I, previously uoted, relate to national eergen!ies

t"ey ust be read toget"er to deterine t"e liitation o t"ee*er!ise o eergen!y powers.

G*'*r%ll, Co'r*)) i) +$* r*po)i+or o *&*r*'/po*r). T"is is evident in t"e tenor o e!tion <5 (<), 'rti!leI aut"oriBing it to delegate su!" powers to t"e residentC*r+%i'l, % o( /%''o+ (*l*%+* % po*r 'o+ r*po)*(po' i+. owever, 2nowing t"at during grave eergen!ies, itay not be possible or pra!ti!able or Congress to eet ande*er!ise its powers, t"e Fraers o our Constitution deeed itwise to allow Congress to grant eergen!y powers to t"eresident, sub3e!t to !ertain !onditions, t"us:








?1@ T"ere ust be a %r or o+$*r *&*r*'/.

?2@ T"e delegation ust be or a li&i+*( p*rio( o'l.

?3@ T"e delegation ust be )H*/+ +o )/$r*)+ri/+io') %) +$* Co'r*)) &% pr*)/ri*.

?4@ T"e eergen!y powers ust be e*er!ised to/%rr o+ % '%+io'%l poli/ de!lared by Congress.1<A

e!tion 17, 'rti!le /II ust be understood as an aspe!t o t"eeergen!y powers !lause. T"e ta2ing over o private businessae!ted wit" publi! interest is 3ust anot"er a!et o t"eeergen!y powers generally reposed upon Congress. T"us,w"en e!tion 17 states t"at t"e +$* S+%+* &%, (ri' +$**&*r*'/ %'( '(*r r*%)o'%l* +*r&) pr*)/ri*( i+,+*&por%ril +%:* o6*r or (ir*/+ +$* op*r%+io' o %'pri6%+*l o'*( pli/ +ili+ or )i'*)) %*/+*( i+$pli/ i'+*r*)+, it reers to Congress, not t"e resident. ow,w"et"er or not t"e resident ay e*er!ise su!" power isdependent on w"et"er Congress ay delegate it to "i pursuant to a law pres!ribing t"e reasonable ters t"ereo.

Loungsto$n Sheet / !ube Co et al v Sa$yer 71<=

"eld:

It is !lear t"at i t"e resident "ad aut"ority to issue t"e order "e did, it ust be ound in soe provision o t"e Constitution.'nd it is not !laied t"at e*press !onstitutional languagegrants t"is power to t"e resident. T"e !ontention is t"at presidential power s"ould be iplied ro t"e aggregate o "is powers under t"e Constitution. arti!ular relian!e is pla!ed on provisions in 'rti!le II w"i!" say t"at T"e e*e!utive ower s"all be vested in a resident . . . .; t"at "e s"all ta2e Caret"at t"e $aws be ait"ully e*e!uted; and t"at "e s"all beCoander#in#C"ie o t"e 'ry and avy o t"e 0nitedtates.

T"e order !annot properly be sustained as an e*er!ise o t"eresidents ilitary power as Coander#in#C"ie o t"e'red For!es. T"e &overnent attepts to do so by !iting anuber o !ases up"olding broad powers in ilitary!oanders engaged in day#to#day ig"ting in a t"eater o war. u!" !ases need not !on!ern us "ere. E6*' +$o$8+$*%+*r o %r8 * %' *5p%'(i' /o'/*p+, * /%''o+ i+$%i+$l'*)) +o or /o')+i++io'%l ))+*& $ol( +$%+ +$*Co&&%'(*r<i'<C$i* o +$* Ar&*( For/*) $%) +$* l+i&%+*po*r %) )/$ +o +%:* po))*))io' o pri6%+* prop*r+ i'or(*r +o :**p l%or (i)p+*) ro& )+oppi' pro(/+io'.T$i) i) % Ho or +$* '%+io') l%&%:*r), 'o+ or i+)

&ili+%r %+$ori+i*).

Nor /%' +$* )*ir* or(*r * ))+%i'*( */%)* o +$*)*6*r%l /o')+i++io'%l pro6i)io') +$%+ r%'+ *5*/+i6*po*r +o +$* #r*)i(*'+. I' +$* r%&*or: o orCo')+i++io', +$* #r*)i(*'+) po*r +o )** +$%+ +$* l%) %r*%i+$ll *5*/+*( r*+*) +$* i(*% +$%+ $* i) +o * %l%&%:*r. T$* Co')+i++io' li&i+) $i) '/+io') i' +$*l%&%:i' pro/*)) +o +$* r*/o&&*'(i' o l%) $* +$i':)i)* %'( +$* 6*+oi' o l%) $* +$i':) %(. A'( +$*Co')+i++io' i) '*i+$*r )il*'+ 'or *i6o/%l %o+ $o )$%ll&%:* l%) $i/$ +$* #r*)i(*'+ i) +o *5*/+*. T$* ir)+)*/+io' o +$* ir)+ %r+i/l* )%) +$%+ 8All l*i)l%+i6* #o*r)

$*r*i' r%'+*( )$%ll * 6*)+*( i' % Co'r*)) o +$* U'i+*(S+%+*). . .1<6

etitioner Cacho;Olivares, et al !ontends t"at t"e tereergen!y under e!tion 17, 'rti!le /II reers to+)'%&i, +p$oo', $rri/%'*and)i&il%ro//rr*'/*). T"is is a liited view o eergen!y.

%ergen!y, as a generi! ter, !onnotes t"e e*isten!e o

!onditions suddenly intensiying t"e degree o e*isting dangerto lie or well#being beyond t"at w"i!" is a!!epted as noralIpli!it in t"is deinitions are t"e eleents o intensityvariety, and per!eption.1<7 %ergen!ies, as per!eived bylegislature or e*e!utive in t"e 0nited ates sin!e 1955, "ave been o!!asioned by a wide range o situations, !lassiiableunder t"ree (5) prin!ipal "eads: %@ */o'o&i/,1<? @ '%+r%(i)%)+*r,1<9 and /@ '%+io'%l )*/ri+.15>

%ergen!y, as !onteplated in our Constitution, is o t"esae breadt". It ay in!lude rebellion, e!onoi! !risis pestilen!e or epidei!, typ"oon, lood, or ot"er siilar!atastrop"e o nationwide proportions or ee!t.151 T"is is

evident in t"e -e!ords o t"e Constitutional Coission, t"us

+-. &'CO. Les. E"at is t"e Coittees deinition onational eergen!y w"i!" appears in e!tion 15, page =P Itreads:

E"en t"e !oon good so reuires, t"e tate ayteporarily ta2e over or dire!t t"e operation o any privatelyowned publi! utility or business ae!ted wit" publi! interest.

+-. I$$%&'. E"at I ean is t"reat ro *5+*r'%%r*))io', or e*aple, /%l%&i+i*) or '%+r%l (i)%)+*r).

+-. &'CO. T"ere is a uestion by Coissioner de los-eyes. E"at about stri2es and riotsP

+-. I$$%&'. tri2es, no; t"ose would not be !overed byt"e ter national eergen!y.

+-. 4%&QO. 0nless t"ey are o su!" proportions su!"t"at t"ey would paralyBe governent servi!e.15<

* * * * * *

+-. TI&O. +ay I as2 t"e !oittee i nationa

eergen!y reers to &ili+%r '%+io'%l *&*r*'/ or !ouldt"is be */o'o&i/ *&*r*'/P

+-. I$$%&'. Les, it !ould reer to o+$ &ili+%r or*/o'o&i/ (i)lo/%+io').

+-. TI&O. T"an2 you very u!".155

It ay be argued t"at w"en t"ere is national eergen!yCongress ay not be able to !onvene and, t"ereore, unable todelegate to t"e resident t"e power to ta2e over privately#owned publi! utility or business ae!ted wit" publi! interest.




























In +raneta v Dinglasan,15A t"is Court ep"asiBed t"atlegislative power, t"roug" w"i!" e*traordinary easures aree*er!ised, reains in Congress even in ties o !risis.

* * *

'ter all t"e !riti!iss t"at "ave been ade against t"eei!ien!y o t"e syste o t"e separation o powers, t"e a!treains t"at t"e Constitution "as set up t"is or o

governent, wit" all its dee!ts and s"ort!oings, in preeren!e to t"e !oingling o powers in one an or groupo en. T"e Filipino people by adopting parliaentarygovernent "ave given noti!e t"at t"ey s"are t"e ait" o ot"er deo!ra!y#loving peoples in t"is syste, wit" all its aults, ast"e ideal. T"e point is, under t"is raewor2 o governent,legislation is preserved or Congress all t"e tie, note*!epting periods o !risis no atter "ow serious. ever in t"e"istory o t"e 0nited tates, t"e basi! eatures o w"oseConstitution "ave been !opied in ours, "ave spe!ii! un!tionso t"e legislative bran!" o ena!ting laws been surrendered toanot"er departent M unless we regard as legislating t"e!arrying out o a legislative poli!y a!!ording to pres!ribedstandards; no, not even w"en t"at -epubli! was ig"ting a totalwar, or w"en it was engaged in a lie#and#deat" struggle to preserve t"e 0nion. T"e trut" is t"at under our !on!ept o !onstitutional governent, in ties o e*tree perils oret"an in noral !ir!ustan!es St"e various bran!"es, e*e!utive,legislative, and 3udi!ial, given t"e ability to a!t, are !alledupon Sto peror t"e duties and dis!"arge t"e responsibilities!oitted to t"e respe!tively.

Following our interpretation o e!tion 17, 'rti!le /II,invo2ed by resident 'rroyo in issuing 1>17, t"is Courtrules t"at su!" ro!laation does not aut"oriBe "er during t"eeergen!y to teporarily ta2e over or dire!t t"e operation o any privately owned publi! utility or business ae!ted wit" publi! interest wit"out aut"ority ro Congress.

$et it be ep"asiBed t"at w"ile t"e resident alone !an de!larea state o national eergen!y, "owever, wit"out legislation, "e"as no power to ta2e over privately#owned publi! utility or business ae!ted wit" publi! interest. T"e resident !annotde!ide w"et"er e*!eptional !ir!ustan!es e*ist warranting t"eta2e over o privately#owned publi! utility or business ae!tedwit" publi! interest. or !an "e deterine w"en su!"e*!eptional !ir!ustan!es "ave !eased. $i2ewise, i+$o+l*i)l%+io' 7 t"e resident "as no power to point out t"e typeso businesses ae!ted wit" publi! interest t"at s"ould be ta2enover. In s"ort, t"e resident "as no absolute aut"ority toe*er!ise all t"e powers o t"e tate under e!tion 17, 'rti!leII in t"e absen!e o an eergen!y powers a!t passed byCongress.

/. 8AS A##LIE" CALLENGE8

One o t"e isortunes o an eergen!y, parti!ularly, t"atw"i!" pertains to se!urity, is t"at ilitary ne!essity and t"eguaranteed rig"ts o t"e individual are oten not !opatible.Our "istory reveals t"at in t"e !ru!ible o !onli!t, any rig"tsare !urtailed and trapled upon. ere, t"e ri$+ %%i')+'r*%)o'%l* )*%r/$ %'( )*ir* +$* ri$+ %%i')+

%rr%'+l*)) %rr*)+ and +$* r**(o& o )p**/$, o*5pr*))io', o +$* pr*)), %'( o %))*&l under t"e 4ill o-ig"ts suered t"e greatest blow.

O t"e seven (7) petitions, t"ree (5) indi!ate dire!t in3ury.

In G.R. No. 17139, petitioners avid and $laas allegedt"at, on February <A, <>>6, t"ey were arrested wit"ouwarrants on t"eir way to %' to !elebrate t"e <>t"

'nniversary o People Po$er I T"e arresting oi!ers !ited 1>17 as basis o t"e arrest.

In G.R. No. 171409, petitioners Ca!"o#Olivares and !ribuneublis"ing Co., In!. !laied t"at on February <=, <>>6, t"eCI& operatives raided and ransa!2ed wit"out warrant t"eiroi!e. T"ree poli!een were assigned to guard t"eir oi!e asa possible sour!e o destabiliBation. 'gain, t"e basis was 1>17.

'nd in G.R. No. 17143, petitioners N+0 and 'F$0N+0 et al alleged t"at t"eir ebers were turned away anddispersed w"en t"ey went to %' and later, to 'yala

'venue, to !elebrate t"e <>t" 'nniversary o People Po$er I .

' perusal o t"e dire!t in3uries allegedly suered by t"e said petitioners s"ows t"at t"ey resulted ro t"e i&pl*&*'+%+io' pursuant to &.O. o. =, o 1>17.

Can this Court adHudge as unconstitutional PP ">" and GO 5o B on the basis o' these illegal actsM In general, does the

illegal implementation o' a la$ render it unconstitutionalM

ettled is t"e rule t"at !ourts are not at liberty to de!larestatutes invalid %l+$o$ +$* &% * %)*( %'(&i)%)*(15= and &% %or( %' oppor+'i+ or %)* i'+$* &%''*r o %ppli/%+io'.156 T"e validity o a statute orordinan!e is to be deterined ro its general purpose and itsei!ien!y to a!!oplis" t"e end desired, 'o+ ro& i+) **/+)i' % p%r+i/l%r /%)*.157 1>17 is erely an invo!ation o t"eresidents !alling#out power. Its general purpose is to!oand t"e 'F to suppress all ors o lawless violen!einvasion or rebellion. It "ad a!!oplis"ed t"e end desiredw"i!" propted resident 'rroyo to issue 1><1. 4ut t"ereis not"ing in 1>17 allowing t"e poli!e, e*pressly oripliedly, to !ondu!t illegal arrest, sear!" or violate t"e!itiBens !onstitutional rig"ts.

ow, ay t"is Court ad3udge a law or ordinan!e

un!onstitutional on t"e ground t"at its ipleentor !oittedillegal a!tsP T"e answer is no. T"e !riterion by w"i!" t"evalidity o t"e statute or ordinan!e is to be easured is t"eessential basis or t"e e*er!ise o power, %'( 'o+ % &*r*i'/i(*'+%l r*)l+ %ri)i' ro& i+) *5*r+io' .15? T"is is logi!al8ust iagine t"e absurdity o situations w"en laws aybede!lared un!onstitutional 3ust be!ause t"e oi!eripleenting t"e "ave a!ted arbitrarily. I t"is were so 3udging ro t"e blunders !oitted by poli!een in t"e!ases passed upon by t"e Court, a3ority o t"e provisions ot"e -evised enal Code would "ave been de!laredun!onstitutional a long tie ago.
















resident 'rroyo issued &.O. o. = to !arry into ee!t t"e provisions o 1>17. &eneral orders are a!ts and!oands o t"e resident in "is !apa!ity as Coander#in#C"ie o t"e 'red For!es o t"e "ilippines. T"ey areinternal rules issued by t"e e*e!utive oi!er to "issubordinates pre!isely or t"e prop*r and *i/i*'+%(&i'i)+r%+io' o l%. u!" rules and regulations !reate norelation e*!ept between t"e oi!ial w"o issues t"e and t"eoi!ial w"o re!eives t"e.159 T"ey are based on and are t"e produ!t o, a relations"ip in w"i!" power is t"eir sour!e, andobedien!e, t"eir ob3e!t.1A> For t"ese reasons, one reuireentor t"ese rules to be valid is t"at t"ey ust be r*%)o'%l*, 'o+%ri+r%r or /%pri/io).

&.O. o. = andates t"e 'F and t"e to iediately!arry out t"e '*/*))%r %'( %ppropri%+* %/+io') %'(&*%)r*) +o )ppr*)) %'( pr*6*'+ %/+) o +*rrori)& %'(l%l*)) violen!e.

0nli2e t"e ter lawless violen!e w"i!" is unarguably e*tantin our statutes and t"e Constitution, and w"i!" is invariablyasso!iated wit" invasion, insurre!tion or rebellion, t"e p"rase a!ts o terroris is still an aorp"ous and vague!on!ept. Congress "as yet to ena!t a law deining and punis"ing a!ts o terroris.

In a!t, t"is deinitional predi!aent or t"e absen!e o anagreed deinition o terroris !onronts not only our !ountry, but t"e international !ounity as well. T"e ollowingobservations are uite apropos:

In t"e a!tual unipolar !onte*t o international relations, t"eig"t against terroris "as be!oe one o t"e basi! slogansw"en it !oes to t"e 3ustii!ation o t"e use o or!e against!ertain states and against groups operating internationally.

$ists o states sponsoring terroris and o terroristorganiBations are set up and !onstantly being updateda!!ording to !riteria t"at are not always 2nown to t"e publi!, but are !learly deterined by strategi! interests.

T"e basi! proble underlying all t"ese ilitary a!tions M or t"reats o t"e use o or!e as t"e ost re!ent by t"e 0nitedtates against Ira M !onsists in t"e absen!e o an agreeddeinition o terroris.

-ear2able !onusion persists in regard to t"e legal!ategoriBation o a!ts o violen!e eit"er by states, by aredgroups su!" as liberation oveents, or by individuals.

T"e dilea !an by suariBed in t"e saying One !ountrysterrorist is anot"er !ountrys reedo ig"ter. T"e apparent!ontradi!tion or la!2 o !onsisten!y in t"e use o t"e terterroris ay urt"er be deonstrated by t"e "istori!al a!tt"at leaders o national liberation oveents su!" as elson+andela in out" 'ri!a, abib 4ourgouiba in Tunisia, or '"ed 4en 4ella in 'lgeria, to ention only a ew, wereoriginally labeled as terrorists by t"ose w"o !ontrolled t"eterritory at t"e tie, but later be!ae internationally respe!tedstatesen.

E"at, t"en, is t"e deining !riterion or terrorist a!ts M t"edi''erentia speci'ica distinguis"ing t"ose a!ts ro eventuallylegitiate a!ts o national resistan!e or sel#deenseP

in!e t"e ties o t"e Cold Ear t"e 0nited ationsOrganiBation "as been trying in vain to rea!" a !onsensus ont"e basi! issue o deinition. T"e organiBation "as intensiiedits eorts re!ently, but "as been unable to bridge t"e gap between t"ose w"o asso!iate terroris wit" any violent a!

by non#state groups against !ivilians, state un!tionaries orinrastru!ture or ilitary installations, and t"ose w"o believein t"e !on!ept o t"e legitiate use o or!e w"en resistan!eagainst oreign o!!upation or against systeati! oppression oet"ni! andor religious groups wit"in a state is !on!erned.

T"e dilea a!ing t"e international !ounity !an best beillustrated by reeren!e to t"e !ontradi!ting !ategoriBation oorganiBations and oveents su!" as alestine $iberationOrganiBation ($O) M w"i!" is a terrorist group or Israel anda liberation oveent or 'rabs and +uslis M t"e Nas"iriresistan!e groups M w"o are terrorists in t"e per!eption oIndia, liberation ig"ters in t"at o a2istan M t"e earlierContras in i!aragua M reedo ig"ters or t"e 0nited tatesterrorists or t"e o!ialist !ap M or, ost drasti!ally, t"e'g"ani +u3a"edeen (later to be!oe t"e Taliban oveent)during t"e Cold Ear period t"ey were a group o reedoig"ters or t"e Eest, nurtured by t"e 0nited tates, and aterrorist gang or t"e oviet 0nion. One !ould go on and on inenuerating e*aples o !onli!ting !ategoriBations t"a!annot be re!on!iled in any way M be!ause o opposing politi!al interests t"at are at t"e roots o t"ose per!eptions.

ow, t"en, !an t"ose !ontradi!ting deinitions and !onli!ting per!eptions and evaluations o one and t"e sae group and itsa!tions be e*plainedP In our analysis, t"e basi! reason ort"ese stri2ing in!onsisten!ies lies in t"e divergent interest ostates. epending on w"et"er a state is in t"e position o ano!!upying power or in t"at o a rival, or adversary, o ano!!upying power in a given territory, t"e deinition oterroris will lu!tuate a!!ordingly. ' state ay eventuallysee itsel as prote!tor o t"e rig"ts o a !ertain et"ni! groupoutside its territory and will t"ereore spea2 o a liberationstruggle, not o terroris w"en a!ts o violen!e by t"isgroup are !on!erned, and vi!e#versa.

T"e 0nited ations OrganiBation "as been unable to rea!" ade!ision on t"e deinition o terroris e*a!tly be!ause o t"ese!onli!ting interests o sovereign states t"at deterine in ea!"and every instan!e "ow a parti!ular ared oveent (i.e. anon#state a!tor) is labeled in regard to t"e terrorists#reedoig"ter di!"otoy. ' poli!y o double standards on t"is vitaissue o international aairs "as been t"e unavoidable!onseuen!e.

T"is deinitional predi!aent o an organiBation !onsistingo sovereign states M and not o peoples, in spite o t"eep"asis in t"e reable to t"e 0nited ations C"arterV M "as be!oe even ore serious in t"e present global power!onstellation: one superpower e*er!ises t"e de!isive role int"e e!urity Coun!il, orer great powers o t"e Cold Ear eraas well as ediu powers are in!reasingly being











arginaliBed; and t"e proble "as be!oe even ore a!utesin!e t"e terrorist atta!2s o 11 epteber <>>1 I t"e 0nitedtates.1A1

T"e absen!e o a law deining a!ts o terroris ay result inabuse and oppression on t"e part o t"e poli!e or ilitary. 'nillustration is w"en a group o persons are erely engaged in adrin2ing spree. Let t"e ilitary or t"e poli!e ay !onsider t"ea!t as an a!t o terroris and iediately arrest t"e

pursuant to &.O. o. =. Obviously, t"is is abuse andoppression on t"eir part. It ust be reebered t"at an a!t!an only be !onsidered a !rie i t"ere is a law deining t"esae as su!" and iposing t"e !orresponding penalty t"ereon.

o ar, t"e word terroris appears only on!e in our !riinallaws, i.e., in .. o. 1?5= dated 8anuary 16, 19?1 ena!ted byresident +ar!os during t"e +artial $aw regie. T"is de!reeis entitled Codiying T"e arious $aws on 'nti#ubversionand In!reasing T"e enalties or +ebers"ip in ubversiveOrganiBations. T"e word terroris is entioned in t"eollowing provision: T"at one w"o !onspires wit" any ot"er person or t"e purpose o overt"rowing t"e &overnent o t"e"ilippines * * * by or!e, violen!e, +*rrori)&, * * * s"all be punis"ed by reclusion temporal * * *.

.. o. 1?5= was repealed by %.O. o. 167 (w"i!" outlawst"e Counist arty o t"e "ilippines) ena!ted by residentCoraBon 'uino on +ay =, 19?=. T"ese two (<) laws,"owever, do not deine a!ts o terroris. in!e t"ere is nolaw deining a!ts o terroris, it is resident 'rroyo alone,under &.O. o. =, w"o "as t"e dis!retion to deterine w"ata!ts !onstitute terroris. er 3udgent on t"is aspe!t isabsolute, wit"out restri!tions. Conseuently, t"ere !an beindis!riinate arrest wit"out warrants, brea2ing into oi!esand residen!es, ta2ing over t"e edia enterprises, pro"ibitionand dispersal o all asseblies and gat"erings unriendly to t"eadinistration. 'll t"ese !an be ee!ted in t"e nae o &.O. o. =. T"ese a!ts go ar beyond t"e !alling#out power o t"eresident. Certainly, t"ey violate t"e due pro!ess !lause o t"eConstitution. T"us, t"is Court de!lares t"at t"e a!ts o terroris portion o &.O. o. = is un!onstitutional.

ignii!antly, t"ere is not"ing in &.O. o. = aut"oriBing t"eilitary or poli!e to !oit a!ts beyond w"at are '*/*))%r%'( %ppropri%+* +o )ppr*)) %'( pr*6*'+ l%l*)) 6iol*'/* ,t"e liitation o t"eir aut"ority in pursuing t"e Order.Ot"erwise, su!" a!ts are !onsidered illegal.

Ee irst e*aine G.R. No. 17139 ( David et al)

T"e Constitution provides t"at t"e rig"t o t"e people to bese!ured in t"eir persons, "ouses, papers and ee!ts againstunreasonable sear!" and seiBure o w"atever nature and or any purpose s"all be in!iolable) and no sear!" warrant or %rr%'+ o %rr*)+ s"all issue e*!ept upon probable !ause to be deterined personally by t"e 3udge ater e*aination under oat" or airation o t"e !oplainant and t"e witnesses "eay produ!e, and parti!ularly des!ribing t"e pla!e to besear!"ed and t"e persons or t"ings to be seiBed.1A< T"e plainiport o t"e language o t"e Constitution is t"at sear!"es,seiBures and arrests are 'or&%ll unreasonable unless

aut"oriBed by a validly issued sear!" warrant or warrant oarrest. T"us, t"e undaental prote!tion given by t"is provision is t"at between person and poli!e ust stand t"e prote!tive aut"ority o a agistrate !lot"ed wit" power toissue or reuse to issue sear!" warrants or warrants o arrest.1A5

In t"e 4rie '!!ount1AA subitted by petitioner avid, !ertaina!ts are establis"ed: 'irst7 "e was arrested wit"out warrant

second7 t"e operatives arrested "i on t"e basis o

1>17; third7 "e was broug"t at Cap Naringal, HueBon Cityw"ere "e was ingerprinted, p"otograp"ed and boo2ed li2e a!riinal suspe!t; 'ourth7"e was treated brusuely by poli!een w"o "eld "is "ead and tried to pus" "i inside anunar2ed !ar; 'i'th7 "e was !"arged wit" iolation o !%+%)#%&%')% !il%' No. 01A= and I'/i+i' +o S*(i+io'; si%th7"e was detained or seven (7) "ours; and seventh7"e waseventually released or insui!ien!y o eviden!e.

e!tion =, -ule 115 o t"e -evised -ules on Criinaro!edure provides:

e!. =. Arrest (ithout (arrant7 (hen la(#ul # ' pea!e oi!er

or a private person ay, wit"out a warrant, arrest a person:

?%@ E"en, in "is presen!e, t"e person to be arrested"as !oitted, is a!tually !oitting, or iattepting to !oit an oense.

?@ E"en an oense "as 3ust been !oitted and "e"as probable !ause to believe based on persona2nowledge o a!ts or !ir!ustan!es t"at t"e personto be arrested "as !oitted it; and

* * *.

eit"er o t"e two (<) e*!eptions entioned above 3ustiies petitioner avids warrantless arrest. uring t"e inuest ort"e !"arges o i'/i+i' +o )*(i+io' and 6iol%+io' o !# 0all t"at t"e arresting oi!ers !ould invo2e was t"eirobservation t"at soe rallyists were wearing t#s"irts wit" t"einve!tive @Oust Gloria 5o$@ and t"eir erroneous assuptiont"at petitioner avid was t"e leader o t"e rally.1A

Conseuently, t"e Inuest rose!utor ordered "is iediaterelease on t"e ground o insui!ien!y o eviden!e. e notedt"at petitioner avid was not wearing t"e sub3e!t t#s"irt andeven i "e was wearing it, su!" a!t is insui!ient to !"arge"i wit" i'/i+i' +o )*(i+io'. Furt"er, "e also stated t"at t"ereis insui!ient eviden!e or t"e !"arge o 6iol%+io' o !# 0

as it was not even 2nown w"et"er petitioner avid was t"eleader o t"e rally.1A7

4ut w"at ade it doubly worse or petitioners avid et al ist"at not only was t"eir rig"t against warrantless arrest violated but also t"eir rig"t to pea!eably asseble.

e!tion A o 'rti!le III guarantees:

o law s"all be passed abridging t"e reedo o spee!", oe*pression, or o t"e press, or t"e rig"t o t"e people pea!eably





















to asseble and petition t"e governent or redress o grievan!es.

'ssebly eans a rig"t on t"e part o t"e !itiBens to eet pea!eably or !onsultation in respe!t to publi! aairs. It is ane!essary !onseuen!e o our republi!an institution and!opleents t"e rig"t o spee!". 's in t"e !ase o reedo o e*pression, t"is rig"t is not to be liited, u!" less denied,e*!ept on a s"owing o a /l*%r %'( pr*)*'+ (%'*r o a

substantive evil t"at Congress "as a rig"t to prevent. In ot"er words, li2e ot"er rig"ts ebra!ed in t"e reedo o e*pression, t"e rig"t to asseble is not sub3e!t to previousrestraint or !ensors"ip. It ay not be !onditioned upon t"e prior issuan!e o a perit or aut"oriBation ro t"egovernent aut"orities e*!ept, o !ourse, i t"e assebly isintended to be "eld in a publi! pla!e, a perit or t"e use o su!" pla!e, and not or t"e assebly itsel, ay be validlyreuired.

T"e ringing trut" "ere is t"at petitioner avid, et al . werearrested w"ile t"ey were e*er!ising t"eir rig"t to pea!eulassebly. T"ey were not !oitting any !rie, neit"er wast"ere a s"owing o a !lear and present danger t"at warrantedt"e liitation o t"at rig"t. 's !an be gleaned ro!ir!ustan!es, t"e !"arges o i'/i+i' +o )*(i+io' and6iol%+io' o !# 0 were ere atert"oug"t. %ven t"eoli!itor &eneral, during t"e oral arguent, ailed to 3ustiyt"e arresting oi!ers !ondu!t. In De 4onge v Oregon,1A? it was"eld t"at pea!eable assebly !annot be ade a !rie, t"us:

ea!eable assebly or lawul dis!ussion !annot be ade a!rie. T"e "olding o eetings or pea!eable politi!al a!tion!annot be pros!ribed. T"ose w"o assist in t"e !ondu!t o su!"eetings !annot be branded as !riinals on t"at s!ore. T"euestion, i t"e rig"ts o ree spee!" and pea!eul assebly arenot to be preserved, is not as to t"e auspi!es under w"i!" t"eeeting was "eld but as to its purpose; not as to t"e relationso t"e spea2ers, but w"et"er t"eir utteran!es trans!end t"e bounds o t"e reedo o spee!" w"i!" t"e Constitution prote!ts. I t"e persons assebling "ave !oitted !rieselsew"ere, i t"ey "ave ored or are engaged in a !onspira!yagainst t"e publi! pea!e and order, t"ey ay be prose!uted or t"eir !onspira!y or ot"er violations o valid laws. !+ i+ i) %(i*r*'+ &%++*r $*' +$* S+%+*, i')+*%( o pro)*/+i'+$*& or )/$ o*')*), )*i*) po' &*r* p%r+i/ip%+io' i' %p*%/*%l* %))*&l %'( % l%l pli/ (i)/))io' %) +$*%)i) or % /ri&i'%l /$%r*.

On t"e basis o t"e above prin!iples, t"e Court li2ewise!onsiders t"e dispersal and arrest o t"e ebers o N+0 et

al (&.-. o. 171A?5) unwarranted. 'pparently, t"eir dispersalwas done erely on t"e basis o +ala!aRangs dire!tive!an!eling all perits previously issued by lo!al governentunits. T"is is arbitrary. T"e w"olesale !an!ellation o all perits to rally is a blatant disregard o t"e prin!iple t"atr**(o& o %))*&l i) 'o+ +o * li&i+*(, &/$ l*))(*'i*(, *5/*p+ o' % )$oi' o % clear and present daner

o % ))+%'+i6* *6il +$%+ +$* S+%+* $%) % ri$+ +opr*6*'+.1A9 Toleran!e is t"e rule and liitation is t"ee*!eption. Only upon a s"owing t"at an assebly presents a!lear and present danger t"at t"e tate ay deny t"e !itiBens

rig"t to e*er!ise it. Indeed, respondents ailed to s"ow or!onvin!e t"e Court t"at t"e rallyists !oitted a!ts aountingto lawless violen!e, invasion or rebellion. Eit" t"e blan2etrevo!ation o perits, t"e distin!tion between prote!ted andunprote!ted asseblies was eliinated.

+oreover, under 4 ??>, t"e aut"ority to regulate assebliesand rallies is lodged wit" t"e lo!al governent units. T"ey"ave t"e power to issue perits and to revo2e su!" perits

%+*r (* 'o+i/* %'( $*%ri' on t"e deterination o t"e presen!e o !lear and present danger. ere, petitioners werenot even notiied and "eard on t"e revo!ation o t"eir perits.1=> T"e irst tie t"ey learned o it was at t"e tie ot"e dispersal. u!" absen!e o noti!e is a atal dee!t. E"en a persons rig"t is restri!ted by governent a!tion, it be"ooves adeo!rati! governent to see to it t"at t"e restri!tion is airreasonable, and a!!ording to pro!edure.

G.R. No. 171409, (Ca!"o#Olivares, et al) presents anot"era!et o reedo o spee!" i.e., t"e reedo o t"e pressetitioners narration o a!ts, w"i!" t"e oli!itor &eneraailed to reute, establis"ed t"e ollowing: 'irst7 t"e Daily!ribune:s oi!es were sear!"ed wit"out warrant; second7 t"e poli!e operatives seiBed several aterials or publi!ationthird , t"e sear!" was !ondu!ted at about 1:>> o !lo!2 in t"eorning o February <=, <>>6; 'ourth7 t"e sear!" was!ondu!ted in t"e absen!e o any oi!ial o t"e Daily !ribunee*!ept t"e se!urity guard o t"e building; and 'i'th7 poli!eenstationed t"eselves at t"e vi!inity o t"e Daily !ribuneoi!es.

T"ereater, a wave o warning !ae ro governenoi!ials. residential C"ie o ta +i!"ael eensor wasuoted as saying t"at su!" raid was 8&*%'+ +o )$o % )+ro'pr*)*'/*, +o +*ll &*(i% o+l*+) 'o+ +o /o''i6* or (o%'+$i' +$%+ ol( $*lp +$* r**l) i' ri'i' (o' +$i)o6*r'&*'+.8 ire!tor &eneral $oibao urt"er stated t"at8i +$* (o 'o+ ollo +$* )+%'(%r() %'( +$* )+%'(%r() %r*i +$* ol( /o'+ri+* +o i')+%ili+ i' +$* o6*r'&*'+,or i +$* (o 'o+ ))/ri* +o $%+ i) i' G*'*r%l Or(*r No- %'( #ro/. No. 1017 * ill r*/o&&*'( % S+%:*o6*r. ational Tele!ouni!ations Coissioner -onald olisurged television and radio networ2s to @ cooperate@ wit" t"egovernent or t"e duration o t"e state o nationaeergen!y. * %r'*( +$%+ $i) %*'/ ill 'o+ $*)i+%+* +or*/o&&*'( +$* /lo)r* o %' ro%(/%)+ o+i+ +$%6iol%+*) rl*) )*+ o+ or &*(i% /o6*r%* (ri' +i&*)$*' +$* '%+io'%l )*/ri+ i) +$r*%+*'*(1=1

T"e sear!" is illegal. -ule 1<6 o T"e -evised -ules onCriinal ro!edure lays down t"e steps in t"e !ondu!t osear!" and seiBure. S*/+io' 4 reuires t"at a )*%r/$ %rr%' be issued upon probable !ause in !onne!tion wit" one spe!ii!oen!e to be deterined personally by t"e 3udge atere*aination under oat" or airation o t"e !oplainant andt"e witnesses "e ay produ!e. S*/+io' andates t"at t"esear!" o a "ouse, roo, or any ot"er preise be ade i' +$*pr*)*'/* o +$* l%l o//p%'+ t"ereo or any eber o"is aily or in t"e absen!e o t"e latter, in t"e presen!e o two(<) witnesses o sui!ient age and dis!retion residing in t"esae lo!ality. 'nd S*/+io' 9 states t"at t"e warrant us















CI%F 80TIC% '&'I4':

T"ere sees to be soe !onusions i not !ontradi!tion inyour t"eory.

O$ICITO- &%%-'$ 4%I'LO:

I dont 2now w"et"er t"is will !lariy. T"e a!ts, t"e supposedillegal or unlawul a!ts !oitted on t"e o!!asion o 1>17, as

I said, i+ /%''o+ * /o'(o'*(. Lou !annot blae t"e residentor, as you said, a isappli!ation o t"e law. T"ese are a!ts o t"e poli!e oi!ers, t"at is t"eir responsibility.1=7

T"e issenting Opinion states t"at 1>17 and &.O. o. =are !onstitutional in every aspe!t and s"ould result in no!onstitutional or statutory brea!"es i applied a!!ording tot"eir letter.

T"e Court "as passed upon t"e !onstitutionality o t"eseissuan!es. Its ratio!ination "as been e*"austively presented. 'tt"is point, sui!e it to reiterate t"at 1>17 is liited to t"e!alling out by t"e resident o t"e ilitary to prevent or

suppress lawless violen!e, invasion or rebellion. E"en inipleenting its provisions, pursuant to &.O. o. =, t"eilitary and t"e poli!e !oitted a!ts w"i!" violate t"e!itiBens rig"ts under t"e Constitution, t"is Court "as tode!lare su!" a!ts un!onstitutional and illegal.

In t"is !onne!tion, C"ie 8usti!e 'rteio . anganibans!on!urring opinion, atta!"ed "ereto, is !onsidered an integral part o t"is ponencia.

S U M M A T I O N

In su, t"e liting o 1>17 t"roug" t"e issuan!e o 1><1 M a supervening event M would "ave norally rendered t"is!ase oot and a!adei!. owever, w"ile 1>17 was stilloperative, illegal a!ts were !oitted allegedly in pursuan!et"ereo. 4esides, t"ere is no guarantee t"at 1>17, or onesiilar to it, ay not again be issued. 'lready, t"ere "ave beenedia reports on 'pril 5>, <>>6 t"at allegedly 1>17 would be reiposed i t"e +ay 1 rallies be!oe unruly andviolent. Conseuently, t"e trans!endental issues raised by t"e parties s"ould not be evaded; t"ey ust now be resolved to prevent uture !onstitutional aberration.

T"e Court inds and so "olds t"at 1>17 is !onstitutionalinsoar as it !onstitutes a !all by t"e resident or t"e 'F to prevent or suppress l%l*)) 6iol*'/*. T"e pro!laation issustained by e!tion 1?, 'rti!le II o t"e Constitution andt"e relevant 3urispruden!e dis!ussed earlier. owever, 1>17s e*traneous provisions giving t"e resident e*press or iplied power (1) to issue de!rees; (<) to dire!t t"e 'F toenor!e obedien!e to %ll l%) even t"ose not related to lawlessviolen!e as well as de!rees proulgated by t"e resident; and(5) to ipose standards on edia or any or o prior restrainton t"e press, are ultra vires and '/o')+i++io'%l. T"e Courtalso rules t"at under e!tion 17, 'rti!le /II o t"eConstitution, t"e resident, in t"e absen!e o a legislation,

!annot ta2e over privately#owned publi! utility and private business ae!ted wit" publi! interest.

In t"e sae vein, t"e Court inds &.O. o. = valid. It is anOrder issued by t"e resident M a!ting as Coander#in#C"ie M addressed to subalterns in t"e 'F to !arry out t"e provisions o 1>17. ignii!antly, it also provides a validstandard M t"at t"e ilitary and t"e poli!e s"ould ta2e only t"e'*/*))%r %'( %ppropri%+* %/+io') %'( &*%)r*) +o

)ppr*)) %'( pr*6*'+ %/+) o l%l*)) 6iol*'/*.4ut t"ewords %/+) o +*rrori)& ound in &.O. o. = "ave not beenlegally deined and ade punis"able by Congress and s"ouldt"us be deeed deleted ro t"e said &.O. E"ile terroris"as been denoun!ed generally in edia, no law "as beenena!ted to guide t"e ilitary, and eventually t"e !ourts, todeterine t"e liits o t"e 'Fs aut"ority in !arrying out t"is portion o &.O. o. =.

On t"e basis o t"e relevant and un!ontested a!ts narratedearlier, it is also pristine !lear t"at (1) t"e warrantless arrest o petitioners -andol . avid and -onald $laas; (<) t"edispersal o t"e rallies and warrantless arrest o t"e N+0 and 'F$0#N+0 ebers; (5) t"e iposition o standards onedia or any prior restraint on t"e press; and (A) t"ewarrantless sear!" o t"e !ribune oi!es and t"e w"isi!aseiBures o soe arti!les or publi!ation and ot"er aterialsare not aut"oriBed by t"e Constitution, t"e law and 3urispruden!e. ot even by t"e valid provisions o 1>17and &.O. o. =.

Ot"er t"an t"is de!laration o invalidity, t"is Court !annoipose any !ivil, !riinal or adinistrative san!tions on t"eindividual poli!e oi!ers !on!erned. T"ey "ave not beenindividually identiied and given t"eir day in !ourt. T"e !ivi!oplaints or !auses o a!tion andor relevant !riinaInorations "ave not been presented beore t"is Court%leentary due pro!ess bars t"is Court ro a2ing anyspe!ii! pronoun!eent o !ivil, !riinal or adinistrativeliabilities.

It is *ll +o r*&*&*r +$%+ &ili+%r po*r i) % &*%') +o %'*'( %'( ))+%'+i6* /i6il ri$+) %r* *'() i' +$*&)*l6*)o +o i6* +$* &ili+%r +$* po*r i+ '**() +o pro+*/+ +$*R*pli/ i+$o+ ''*/*))%ril +r%&pli' i'(i6i(%ri$+) i) o'* o +$* *+*r'%l %l%'/i' +%):) o % (*&o/r%+i/)+%+*.uring eergen!y, governental a!tion ay vary in breadt" and intensity ro noral ties, yet t"ey s"ould not be arbitrary as to unduly restrain our peoples liberty.

er"aps, t"e vital lesson t"at we ust learn ro t"e t"eoristsw"o studied t"e various !opeting politi!al p"ilosop"ies ist"at, it is possible to grant governent t"e aut"ority to !opewit" !rises wit"out surrendering t"e two vital prin!iples o!onstitutionalis: +$* &%i'+*'%'/* o l*%l li&i+) +o%ri+r%r po*r, and poli+i/%l r*)po')iili+ o +$*o6*r'&*'+ +o +$* o6*r'*(.1=?

;EREFORE, t"e etitions are partly granted. T"e Courtrules t"at 1>17 is CONSTITUTIONAL insoar as i!onstitutes a !all by resident &loria +a!apagal#'rroyo ont"e 'F +o pr*6*'+ or )ppr*)) l%l*)) 6iol*'/*. owever








t"e provisions o 1>17 !oanding t"e 'F to enor!elaws not related to lawless violen!e, as well as de!rees proulgated by t"e resident, are de!laredUNCONSTITUTIONAL. In addition, t"e provision in 1>17 de!laring national eergen!y under e!tion 17, 'rti!leII o t"e Constitution is CONSTITUTIONAL, but su!"de!laration does not aut"oriBe t"e resident to ta2e over privately#owned publi! utility or business ae!ted wit" publi!interest wit"out prior legislation.

&.O. o. = is CONSTITUTIONAL sin!e it provides astandard by w"i!" t"e 'F and t"e s"ould ipleent 1>17, i.e. w"atever is '*/*))%r %'( %ppropri%+* %/+io')%'( &*%)r*) +o )ppr*)) %'( pr*6*'+ %/+) o l%l*))6iol*'/*. Considering t"at a!ts o terroris "ave not yet been deined and ade punis"able by t"e $egislature, su!" portion o &.O. o. = is de!lared UNCONSTITUTIONAL.

T"e warrantless arrest o -andol . avid and -onald$laas; t"e dispersal and warrantless arrest o t"e N+0 and 'F$0#N+0 ebers during t"eir rallies, in t"e absen!e o proo t"at t"ese petitioners were !oitting a!ts !onstitutinglawless violen!e, invasion or rebellion and violating 4 ??>;t"e iposition o standards on edia or any or o prior restraint on t"e press, as well as t"e warrantless sear!" o t"e!ribune oi!es and w"isi!al seiBure o its arti!les or publi!ation and ot"er aterials, are de!laredUNCONSTITUTIONAL.

o !osts.

SO OR"ERE".

&.-. o. 19<95= e!eber 7, <>1>$O0I W4'-ONX C. 4I-'O&O

vs.T% I$II% T-0T CO++IIO OF <>1>

* M # M # M # M # M # M # M # M # M # M # M # #*&.-. o. 195>56-%. %C%$ C. $'&+', -%. -OO$FO 4. '$4'O,8-., -%. I+%O '. 'T0+'O&, and -%.O-$'O 4. F0', -.vs.%/%C0TI% %C-%T'-L 'H0ITO . OCO', 8-. and%'-T+%T OF 40&%T ' +''&%+%T%C-%T'-L F$O-%CIO 4. '4'

FACTS:

res. 'uino signed %. O. o. 1 establis"ing "ilippine Trut"Coission o <>1> (TC) dated 8uly 5>, <>1>.

TC is a ere ad "o! body ored under t"e Oi!e o t"eresident wit" t"e priary tas2 to investigate reports o gratand !orruption !oitted by t"ird#level publi! oi!ers andeployees, t"eir !o#prin!ipals, a!!opli!es and a!!essoriesduring t"e previous adinistration, and to subit its indingand re!oendations to t"e resident, Congress and t"eObudsan. TC "as all t"e powers o an investigative body.

4ut it is not a uasi#3udi!ial body as it !annot ad3udi!atearbitrate, resolve, settle, or render awards in disputes between!ontending parties. 'll it !an do is gat"er, !olle!t and assesseviden!e o grat and !orruption and a2e re!oendationsIt ay "ave subpoena powers but it "as no power to !ite people in !ontept, u!" less order t"eir arrest. 'lt"oug" it isa a!t#inding body, it !annot deterine ro su!" a!ts i probable !ause e*ists as to warrant t"e iling o an inorationin our !ourts o law.

etitioners as2ed t"e Court to de!lare it un!onstitutional and toen3oin t"e TC ro peroring its un!tions. T"ey arguedt"at:

(a) %.O. o. 1 violates separation o powers as it arrogates t"e power o t"e Congress to !reate a publi! oi!e and appropriateunds or its operation.

(b) T"e provision o 4oo2 III, C"apter 1>, e!tion 51 o t"e'dinistrative Code o 19?7 !annot legitiiBe %.O. o. 1 be!ause t"e delegated aut"ority o t"e resident to stru!turallyreorganiBe t"e Oi!e o t"e resident to a!"ieve e!onoy

sipli!ity and ei!ien!y does not in!lude t"e power to !reatean entirely new publi! oi!e w"i!" was "it"erto ine*istentli2e t"e WTrut" Coission.X

(!) %.O. o. 1 illegally aended t"e Constitution and statutesw"en it vested t"e WTrut" CoissionX wit" uasi#3udi!ial powers dupli!ating, i not superseding, t"ose o t"e Oi!e ot"e Obudsan !reated under t"e 19?7 Constitution and t"eO8 !reated under t"e 'dinistrative Code o 19?7.

(d) %.O. o. 1 violates t"e eual prote!tion !lause as isele!tively targets or investigation and prose!ution oi!ialsand personnel o t"e previous adinistration as i !orruption is

t"eir pe!uliar spe!ies even as it e*!ludes t"ose o t"e ot"eradinistrations, past and present, w"o ay be indi!table.

-espondents, t"roug" O&, uestioned t"e legal standing o petitioners and argued t"at:

1K %.O. o. 1 does not arrogate t"e powers o Congres be!ause t"e residents e*e!utive power and power o !ontrone!essarily in!lude t"e in"erent power to !ondu!investigations to ensure t"at laws are ait"ully e*e!uted andt"at, in any event, t"e Constitution, -evised 'dinistrativeCode o 19?7, o. 1A1616 (as aended), -.'. o. 997>and settled 3urispruden!e, aut"oriBe t"e resident to !reate or

or su!" bodies.

<K %.O. o. 1 does not usurp t"e power o Congress toappropriate unds be!ause t"ere is no appropriation but a ereallo!ation o unds already appropriated by Congress.

5K T"e Trut" Coission does not dupli!ate or supersede t"eun!tions o t"e Obudsan and t"e O8, be!ause it is a a!t#inding body and not a uasi#3udi!ial body and its un!tions donot dupli!ate, supplant or erode t"e latters 3urisdi!tion.



AK T"e Trut" Coission does not violate t"e eual prote!tion!lause be!ause it was validly !reated or laudable purposes.

ISSUES:

1. EO t"e petitioners "ave legal standing to ile t"e petitionsand uestion %. O. o. 1;<. EO %. O. o. 1 violates t"e prin!iple o separation o powers by usurping t"e powers o Congress to !reate and to

appropriate unds or publi! oi!es, agen!ies and!oissions;5. EO %. O. o. 1 supplants t"e powers o t"e Obudsanand t"e O8;A. EO %. O. o. 1 violates t"e eual prote!tion !lause.

RULING:T"e power o 3udi!ial review is sub3e!t to liitations, to wit:(1) t"ere ust be an a!tual !ase or !ontroversy !alling or t"ee*er!ise o 3udi!ial power; (<) t"e person !"allenging t"e a!tust "ave t"e standing to uestion t"e validity o t"e sub3e!ta!t or issuan!e; ot"erwise stated, "e ust "ave a personal andsubstantial interest in t"e !ase su!" t"at "e "as sustained, or

will sustain, dire!t in3ury as a result o its enor!eent; (5) t"euestion o !onstitutionality ust be raised at t"e earliestopportunity; and (A) t"e issue o !onstitutionality ust be t"every lis ota o t"e !ase.

1. T"e petition priarily invo2es usurpation o t"e power o t"e Congress as a body to w"i!" t"ey belong as ebers. Tot"e e*tent t"e powers o Congress are ipaired, so is t"e power o ea!" eber t"ereo, sin!e "is oi!e !oners a rig"tto parti!ipate in t"e e*er!ise o t"e powers o t"at institution.

$egislators "ave a legal standing to see to it t"at t"e prerogative, powers and privileges vested by t"e Constitution

in t"eir oi!e reain inviolate. T"us, t"ey are allowed touestion t"e validity o any oi!ial a!tion w"i!", to t"eir ind, inringes on t"eir prerogatives as legislators.

Eit" regard to 4iraogo, "e "as not s"own t"at "e sustained, or is in danger o sustaining, any personal and dire!t in3uryattributable to t"e ipleentation o %. O. o. 1.

$o!us standi is Wa rig"t o appearan!e in a !ourt o 3usti!e on agiven uestion.X In private suits, standing is governed by t"eWreal#parties#in interestX rule. It provides t"at Wevery a!tionust be prose!uted or deended in t"e nae o t"e real partyin interest.X -eal#party#in interest is Wt"e party w"o stands to

be beneited or in3ured by t"e 3udgent in t"e suit or t"e partyentitled to t"e avails o t"e suit.X

ii!ulty o deterining lo!us standi arises in publi! suits.ere, t"e plainti w"o asserts a Wpubli! rig"tX in assailing anallegedly illegal oi!ial a!tion, does so as a representative o t"e general publi!. e "as to s"ow t"at "e is entitled to see2 3udi!ial prote!tion. e "as to a2e out a sui!ient interest int"e vindi!ation o t"e publi! order and t"e se!uring o relie asa W!itiBenX or Wta*payer.

T"e person w"o ipugns t"e validity o a statute ust "ave Wa personal and substantial interest in t"e !ase su!" t"at "e "assustained, or will sustain dire!t in3ury as a result.X T"e Court"owever, inds reason in 4iraogos assertion t"at t"e petition!overs atters o trans!endental iportan!e to 3ustiy t"ee*er!ise o 3urisdi!tion by t"e Court. T"ere are !onstitutionaissues in t"e petition w"i!" deserve t"e attention o t"is Courtin view o t"eir seriousness, novelty and weig"t as pre!edents

T"e %*e!utive is given u!" leeway in ensuring t"at our lawsare ait"ully e*e!uted. T"e powers o t"e resident are noliited to t"ose spe!ii! powers under t"e Constitution. One ot"e re!ogniBed powers o t"e resident granted pursuant to t"is!onstitutionally#andated duty is t"e power to !reate ad "o!!oittees. T"is lows ro t"e obvious need to as!ertaina!ts and deterine i laws "ave been ait"ully e*e!uted. T"e purpose o allowing ad "o! investigating bodies to e*ist is toallow an inuiry into atters w"i!" t"e resident is entitled to2now so t"at "e !an be properly advised and guided in t"e peroran!e o "is duties relative to t"e e*e!ution andenor!eent o t"e laws o t"e land.

<. T"ere will be no appropriation but only an allotent orallo!ations o e*isting unds already appropriated. T"ere is nousurpation on t"e part o t"e %*e!utive o t"e power oCongress to appropriate unds. T"ere is no need to spe!iy t"eaount to be earar2ed or t"e operation o t"e !oission be!ause, w"atever unds t"e Congress "as provided or t"eOi!e o t"e resident will be t"e very sour!e o t"e unds ort"e !oission. T"e aount t"at would be allo!ated to t"eTC s"all be sub3e!t to e*isting auditing rules and regulationsso t"ere is no ipropriety in t"e unding.

5. TC will not supplant t"e Obudsan or t"e O8 or erodet"eir respe!tive powers. I at all, t"e investigative un!tion ot"e !oission will !opleent t"ose o t"e two oi!es. T"eun!tion o deterining probable !ause or t"e iling o t"eappropriate !oplaints beore t"e !ourts reains to be wit"t"e O8 and t"e Obudsan. TCs power to investigate isliited to obtaining a!ts so t"at it !an advise and guide t"eresident in t"e peroran!e o "is duties relative to t"ee*e!ution and enor!eent o t"e laws o t"e land.

A. Court inds dii!ulty in up"olding t"e !onstitutionality o%*e!utive Order o. 1 in view o its apparent transgression ot"e eual prote!tion !lause ens"rined in e!tion 1, 'rti!le III(4ill o -ig"ts) o t"e 19?7 Constitution.

%ual prote!tion reuires t"at all persons or t"ings siilarlysituated s"ould be treated ali2e, bot" as to rig"ts !onerred andresponsibilities iposed. It reuires publi! bodies andinstitutions to treat siilarly situated individuals in a siilaranner. T"e purpose o t"e eual prote!tion !lause is to se!ureevery person wit"in a states 3urisdi!tion against intentionaand arbitrary dis!riination, w"et"er o!!asioned by t"ee*press ters o a statue or by its iproper e*e!ution t"roug"t"e states duly !onstituted aut"orities.

T"ere ust be euality aong euals as deterined a!!ordingto a valid !lassii!ation. %ual prote!tion !lause perits!lassii!ation. u!" !lassii!ation, "owever, to be valid us



pass t"e test o reasonableness. T"e test "as our reuisites: (1)T"e !lassii!ation rests on substantial distin!tions; (<) It isgerane to t"e purpose o t"e law; (5) It is not liited toe*isting !onditions only; and (A) It applies eually to allebers o t"e sae !lass.

T"e !lassii!ation will be regarded as invalid i all t"eebers o t"e !lass are not siilarly treated, bot" as to rig"ts!onerred and obligations iposed.

%*e!utive Order o. 1 s"ould be stru!2 down as violative o t"e eual prote!tion !lause. T"e !lear andate o trut"!oission is to investigate and ind out t"e trut" !on!erningt"e reported !ases o grat and !orruption during t"e previousadinistration only. T"e intent to single out t"e previousadinistration is plain, patent and aniest.

'rroyo adinistration is but 3ust a eber o a !lass, t"at is, a!lass o past adinistrations. It is not a !lass o its own. ot toin!lude past adinistrations siilarly situated !onstitutesarbitrariness w"i!" t"e eual prote!tion !lause !annotsan!tion. u!" dis!riinating dierentiation !learly

reverberates to label t"e !oission as a ve"i!le or vindi!tiveness and sele!tive retribution. uperi!ial dieren!esdo not a2e or a valid !lassii!ation.

T"e TC ust not e*!lude t"e ot"er past adinistrations. T"eTC ust, at least, "ave t"e aut"ority to investigate all pastadinistrations.

T"e Constitution is t"e undaental and paraount law o t"enation to w"i!" all ot"er laws ust !onor and in a!!ordan!ewit" w"i!" all private rig"ts deterined and all publi!aut"ority adinistered. $aws t"at do not !onor to t"eConstitution s"ould be stri!2en down or being

un!onstitutional.

E%-%FO-%, t"e petitions are &-'T%. %*e!utive Order o. 1 is "ereby de!lared 0COTIT0TIO'$ insoar as itis violative o t"e eual prote!tion !lause o t"e Constitution.

FI-T IIIO

J&.-. o. 1=<?A=. 'ugust =, <>>5K

-I'IT' 4'&'OI', F%$L +'-I'&', I-$LT'&'4', -IC'-O '-'I, 0' I+%-I'$,4%8'+I %+%+, -OO$FO '&', %&'-O4'C$I&, &-%&O-IO $'4'L', I$'-IO 8%-%Q, and+'-I' CO-'QO C0''&, petitioners7 vs 'TIO'$ TO4'CCO '+IIT-'TIO, represented by

'TOIO % &0Q+' and %-$IT' 4'0$'respondents

% C I I O

IT0&, 4 .:

resident 8osep" %strada issued on 5> epteber 199?%*e!utive Order o. <9, entitled W+andating t"e trealining

o t"e ational Toba!!o 'dinistration (T'),X a governenagen!y under t"e epartent o 'gri!ulture. T"e order wasollowed by anot"er issuan!e, on <7 O!tober 199?, byresident %strada o %*e!utive Order o. 56, aending%*e!utive Order o. <9, insoar as t"e new staing patternwas !on!erned, by in!reasing ro our "undred (A>>) to noe*!eeding seven "undred ity (7=>) t"e positions ae!tedt"ereby. In !oplian!e t"erewit", t"e T' prepared andadopted a new OrganiBation tru!ture and taing attern(O) w"i!", on <9 O!tober 199?, was subitted to t"eOi!e o t"e resident.

On 11 oveber 199?, t"e ran2 and ile eployees o T'

4ata!, aong w"o in!luded "erein petitioners, iled a letter#appeal wit" t"e Civil ervi!e Coission and soug"t itsassistan!e in re!alling t"e O. On >A e!eber 199?, t"eO was approved by t"e epartent o 4udget and+anageent (4+) sub3e!t to !ertain revisions. On evendate, t"e T' !reated a pla!eent !oittee to assist t"eappointing aut"ority in t"e sele!tion and pla!eent o peranent personnel in t"e revised O. T"e results o t"eevaluation by t"e !oittee on t"e individual ualii!ations oappli!ants to t"e positions in t"e new O were t"endisseinated and posted at t"e !entral and provin!ial oi!eso t"e T'.

On 1> 8une 1996, petitioners, all o!!upying dierent positionsat t"e T' oi!e in 4ata!, Ilo!os orte, re!eived individuanoti!es o terination o t"eir eployent wit" t"e T'ee!tive t"irty (5>) days ro re!eipt t"ereo. Findingt"eselves wit"out any iediate relie ro t"eir disissaro t"e servi!e, petitioners iled a petition or certiorari pro"ibition and mandamus7 wit" prayer or preliinaryandatory in3un!tion andor teporary restraining order, wit"t"e -egional Trial Court (-TC) o 4ata!, Ilo!os orte, and prayed #

W1) t"at a restraining order be iediately issueden3oining t"e respondents ro enor!ing t"e noti!e o

terination addressed individually to t"e petitioners andorro !oitting urt"er a!ts o dispossession andor oustingt"e petitioners ro t"eir respe!tive oi!es;

W<) t"at a writ o preliinary in3un!tion be issued againstt"e respondents, !oanding t"e to aintain t"e status uoto prote!t t"e rig"ts o t"e petitioners pending t"edeterination o t"e validity o t"e ipleentation o t"eirdisissal ro t"e servi!e; and

W5) t"at, ater trial on t"e erits, 3udgent be renderedde!laring t"e noti!e o terination o t"e petitioners illega



and t"e reorganiBation null and void and ordering t"eir reinstateent wit" ba!2wages, i appli!able, !oanding t"erespondents to desist ro urt"er terinating t"eir servi!es,and a2ing t"e in3un!tion peranent.X1J1K

T"e -TC, on >9 epteber <>>>, ordered t"e T' to appoint petitioners in t"e new O to positions siilar or !oparableto t"eir respe!tive orer assignents. ' otion or re!onsideration iled by t"e T' was denied by t"e trial !ourt

in its order o <? February <>>1. T"ereupon, t"e T' iled anappeal wit" t"e Court o 'ppeals, raising t"e ollowing issues:

WI. E"et"er or not respondents subittedeviden!e as proo t"at petitioners,individually, were not t"e Sbest ualiied andost deserving aong t"e in!ubentappli!ant#eployees.

WII. E"et"er or not in!ubent peranenteployees, in!luding "erein petitioners,autoati!ally en3oy a preerential rig"t andt"e rig"t o irst reusal to

appointentsreappointents in t"e newOrganiBation tru!ture 'nd taing attern(O) o respondent T'.

WIII. E"et"er or not respondent T' inipleenting t"e andated reorganiBation pursuant to %.O. o. <9, as aended by%.O. o. 56, stri!tly ad"ere to t"eipleenting rules on reorganiBation, parti!ularly -' 66=6 and o t"e Civilervi!e Coission M -ules on&overnent -eorganiBation.

WI. E"et"er or not t"e validity o %.O. os. <9and 56 !an be put in issue in t"e instant!aseappeal.X<J<K

On <> February <>><, t"e appellate !ourt rendered a de!isionreversing and setting aside t"e assailed orders o t"e trial!ourt.

etitioners went to t"is Court to assail t"e de!ision o t"eCourt o 'ppeals, !ontending t"at #

WI. T"e Court o 'ppeals erred in a2ing ainding t"at went beyond t"e issues o t"e

!ase and w"i!" are !ontrary to t"ose o t"etrial !ourt and t"at it overloo2ed !ertainrelevant a!ts not disputed by t"e parties andw"i!", i properly !onsidered, would 3ustiya dierent !on!lusion;

WII. T"e Court o 'ppeals erred in up"olding%*e!utive Order os. <9 and 56 o t"e

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2

Oi!e o t"e resident w"i!" are ereadinistrative issuan!es w"i!" do not "avet"e or!e and ee!t o a law to warrantabolition o positions andor ee!ting totalreorganiBation;

WIII. T"e Court o 'ppeals erred in "olding t"a petitioners reoval ro t"e servi!e is ina!!ordan!e wit" law;

WI. T"e Court o 'ppeals erred in "olding t"arespondent T' was not guilty o bad ait"in t"e terination o t"e servi!es o petitioners; (and)

W. T"e Court o 'ppeals erred in ignoring !aselaw3urispruden!e in t"e abolition o anoi!e.X5J5K

In its resolution o 1> 8uly <>><, t"e Court reuired t"e T'to ile its !oent on t"e petition. On 1? oveber <>><ater t"e T' "ad iled its !oent o <5 epteber <>><,

t"e Court issued its resolution denying t"e petition or ailureo petitioners to sui!iently s"ow any reversible error on t"e part o t"e appellate !ourt in its !"allenged de!ision so as towarrant t"e e*er!ise by t"is Court o its dis!retionary appellate 3urisdi!tion. ' otion or re!onsideration iled by petitionerswas denied in t"e Courts resolution o <> 8anuary <>><.

On <1 February <>>5, petitioners subitted a W+otion to'dit etition For En anc -esolutionX o t"e !ase allegedlyto address a basi! uestion, ie, Wt"e legal and !onstitutionaissue on w"et"er t"e T' ay be reorganiBed by an e*e!utiveiat, not by legislative a!tion.XAJAK In t"eir Wetition or an En

anc -esolutionX petitioners would "ave it t"at #

W1. T"e Court o 'ppeals de!ision up"olding t"ereorganiBation o t"e ational Toba!!o 'dinistration sets adangerous pre!edent in t"at:

Wa) ' ere %*e!utive Order issued by t"e Oi!e o t"eresident and pro!ured by a governent un!tionary would"ave t"e ee!t o a blan2et aut"ority to reorganiBe a bureauoi!e or agen!y atta!"ed to t"e various e*e!utivedepartents;

Sb) T"e resident o t"e "ilippines would "ave t"e plenary power to reorganiBe t"e entire governen

4ureau!ra!y t"roug" t"e issuan!e o an %*e!utive Order, anadinistrative issuan!e wit"out t"e beneit o duedeliberation, debate and dis!ussion o ebers o bot"!"abers o t"e Congress o t"e "ilippines;

S!) T"e rig"t to se!urity o tenure to a !areer position!reated by law or statute would be deeated by t"e ereadoption o an OrganiBational tru!ture and taing attern

3

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issued pursuant to an %*e!utive Order w"i!" is not a law and!ould t"us not abolis" an oi!e !reated by law;

W<. T"e !ase law on abolition o an oi!e would bedisregarded, ignored and abandoned i t"e Court o 'ppealsde!ision sub3e!t atter o t"is etition would reainundisturbed and untou!"ed. In ot"er words, previousdo!trines and pre!edents o t"is ig"est Court would in ee!t be reversed andor odiied wit" t"e Court o 'ppeals

3udgent, s"ould it reain un!"allenged.

W5. e!tion A o %*e!utive Order o. <A= dated 8uly <A,19?7 ('nne* S, etition), issued by t"e -evolutionarygovernent o orer resident CoraBon 'uino, and t"e law!reating T', w"i!" provides t"at t"e governing body o T'is t"e 4oard o ire!tors, would be rendered eaningless,inee!tive and a dead letter law be!ause t"e !"allenged T'reorganiBation w"i!" was erroneously up"eld by t"e Court o 'ppeals was adopted and ipleented by t"en T''dinistrator 'ntonio de &uBan wit"out t"e !orrespondingaut"ority ro t"e 4oard o ire!tors as andated t"erein. In brie, t"e reorganiBation is an ultra vires a!t o t"e T''dinistrator.

WA. T"e !"allenged %*e!utive Order o. <9 issued byorer resident 8osep" %strada but unsigned by t"en%*e!utive e!retary -onaldo Qaora would in ee!t beerroneously up"eld and given legal ee!t as to supersede,aend andor odiy %*e!utive Order o. <A=, a law issuedduring t"e Freedo Constitution o resident CoraBon'uino. In brie, a ere e*e!utive order would aend,supersede andor render inee!tive a law or statute.X=J=K

In order to allow t"e parties a ull opportunity to ventilate t"eir views on t"e atter, t"e Court ultiately resolved to "ear t"e

parties in oral arguent. %ssentially, t"e !ore uestion raised by t"e is w"et"er or not t"e resident, t"roug" t"e issuan!eo an e*e!utive order, !an validly !arry out t"e reorganiBationo t"e T'.

otwit"standing t"e apparent pro!edural lapse on t"e part o petitioner to iplead t"e Oi!e o t"e resident as partyrespondent pursuant to e!tion 7, -ule 5, o t"e 1997 -evised-ules o Civil ro!edure, 6J6K t"is Court resolved to rule ont"e erits o t"e petition.

u8lod ng -a$aning EII vs Jamora7J7K ruled t"at t"eresident, based on e*isting laws, "ad t"e aut"ority to !arry

out a reorganiBation in any bran!" or agen!y o t"e e*e!utivedepartent. In said !ase, u8lod ng -a$aning EII!"allenged t"e issuan!e, and soug"t t"e nullii!ation, o %*e!utive Order o. 191 (ea!tivation o t"e %!onoi!Intelligen!e and Investigation 4ureau) and %*e!utive Order o. <<5 (uppleentary %*e!utive Order o. 191 on t"eea!tivation o t"e %!onoi! Intelligen!e and Investigation

5

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7

4ureau and or Ot"er +atters) on t"e ground t"at t"ey wereissued by t"e resident wit" grave abuse o dis!retion and inviolation o t"eir !onstitutional rig"t to se!urity o tenure. T"eCourt e*plained:

WT"e general rule "as always been t"at t"e power to abolis" a publi! oi!e is lodged wit" t"e legislature. T"is pro!eedsro t"e legal pre!ept t"at t"e power to !reate in!ludes t"e power to destroy. ' publi! oi!e is eit"er !reated by t"e

Constitution, by statute, or by aut"ority o law. T"us, e*!epw"ere t"e oi!e was !reated by t"e Constitution itsel, it ay be abolis"ed by t"e sae legislature t"at broug"t it intoe*isten!e.

WT"e e*!eption, "owever, is t"at as ar as bureaus, agen!ies oroi!es in t"e e*e!utive departent are !on!erned, t"eresidents power o !ontrol ay 3ustiy "i to ina!tivate t"eun!tions o a parti!ular oi!e, or !ertain laws ay grant "it"e broad aut"ority to !arry out reorganiBation easures. T"e!ase in point is 1arin v E%ecutive Secretary J<?> C-' 715KIn t"is !ase, it was argued t"at t"ere is no law w"i!"epowers t"e resident to reorganiBe t"e 4I-. In de!reeingot"erwise, t"is Court sustained t"e ollowing legal basis, t"us:

WYInitially, it is argued t"at t"ere is no law yet w"i!" epowerst"e resident to issue %.O. o. 15< or to reorganiBe t"e 4I-.

YEe do not agree.

Y* * * * * *

Ye!tion A? o -.'. 76A= provides t"at:

YYe!. A?. Scaling Do$n and Phase Out o' +ctivities o'

+gencies ithin the E%ecutive ranch M T"e "eads o

departents, bureaus and oi!es and agen!ies are "erebydire!ted to identiy t"eir respe!tive a!tivities w"i!" are nolonger essential in t"e delivery o publi! servi!es and w"i!"ay be scaled do$n7 phased out or abolished7 sub3e!t to !iviservi!e rules and regulations. * * *. +ctual scaling do$n7

phasing out or abolition o t"e a!tivities s"all be ee!ted pursuant to Cir!ulars or Orders issued or t"e purpose by t"eOi!e o t"e resident.

Yaid provision !learly entions t"e a!ts o Y scaling do$n7

phasing out and abolition: o oi!es only and does not !overt"e !reation o oi!es or transer o un!tions. evert"elesst"e a!t o !reating and de!entraliBing is in!luded in t"e

subseuent provision o e!tion 6< w"i!" provides t"at:

YYe!. 6<. 3nauthori2ed organi2ational changes M 0nlesot"erwise !reated by law or dire!ted by t"e resident o t"e"ilippines, no organiBational unit or !"anges in 2ey positionsin any departent or agen!y s"all be aut"oriBed in t"eirrespe!tive organiBation stru!tures and be unded roappropriations by t"is '!t.

N!he 'oregoing provision evidently sho$s that the President is

authori2ed to e''ect organi2ational changes including thecreation o' o''ices in the department or agency concerned

http://sc.judiciary.gov.ph/jurisprudence/2003/aug2003/..%5C..%5C2001%5Cjul2001%5C142801_802.htm




Y* * * * * *

Y'not"er legal basis o %.O. o. 15< is e!tion <>, 4oo2 III o %.O. o. <9< w"i!" states:

YYe!. <>. Residual Po$ers M 0nless Congress providesot"erwise, t"e resident s"all e*er!ise such other po$ers and

'unctions vested in the President $hich are provided 'or under

the la$s and w"i!" are not spe!ii!ally enuerated above or

w"i!" are not delegated by t"e resident in a!!ordan!e wit"law.

Y!his provision spea8s o' such other po$ers vested in the

President under the la$ hat la$ then gives him the po$er

to reorgani2eM It is Presidential Decree 5o "< $hich

amended Presidential Decree 5o "="? !hese decreese%pressly grant the President o' the Philippines the continuing

authority to reorgani2e the national government7 $hich

includes the po$er to group7 consolidate bureaus and

agencies7 to abolish o''ices7 to trans'er 'unctions7 to createand classi'y 'unctions7 services and activities and to

standardi2e salaries and materials T"e validity o t"ese two

de!rees are unuestionable. T"e 19?7 Constitution !learly provides t"at Yall laws, de!rees, e*e!utive orders, pro!laations, letter o instru!tions and ot"er e*e!utiveissuan!es not in!onsistent wit" t"is Constitution s"all reainoperative until aended, repealed or revo2ed. o ar, t"ere isyet no law aending or repealing said de!rees.

Wow, let us ta2e a loo2 at t"e assailed e*e!utive order.

WIn t"e $hereas !lause o %.O. o. 191, orer resident%strada an!"ored "is aut"ority to dea!tivate %II4 on e!tion77 o -epubli! '!t ?7A= ( FL " General +ppropriations

+ct ), a provision siilar to e!tion 6< o -.'. 76A= uoted in

1arin, t"us:

WYe!. 77. Organi2ed Changes M 3nless ot"erwise provided by law or directed by the President o' the Philippines, no!"anges in 2ey positions or organiBational units in anydepartent or agen!y s"all be aut"oriBed in t"eir respe!tiveorganiBational stru!tures and unded ro appropriations provided by t"is '!t.

WEe ad"ere to t"e * * * ruling in 1arin t"at t"is provisionre!ogniBes t"e aut"ority o t"e resident to ee!torganiBational !"anges in t"e departent or agen!y under t"ee*e!utive stru!ture. u!" a ruling urt"er inds support in

e!tion 7? o -epubli! '!t o. ?76>. 0nder t"is law, t"e"eads o departents, bureaus, oi!es and agen!ies and ot"er entities in t"e %*e!utive 4ran!" are dire!ted (a) to !ondu!t a!opre"ensive review o t"is respe!tive andates, issions,ob3e!tives, un!tions, progras, pro3e!ts, a!tivities andsystes and pro!edures; (b) identiy a!tivities w"i!" are nolonger essential in t"e delivery o publi! servi!es and w"i!"ay be s!aled down, p"ased#out or abolis"ed; and (!) adopteasures t"at will result in t"e strealined organiBation andiproved overall peroran!e o t"eir respe!tive agen!ies.e!tion 7? ends up wit" t"e andate t"at t"e a!tualstrealining and produ!tivity iproveent in agen!yorganiBation and operation s"all be ee!ted pursuant to

Cir!ulars or Orders issued or t"e purpose by t"e Oi!e o t"eresident. T"e law "as spo2en !learly. Ee are let only wit"t"e duty to sustain.

W4ut o !ourse, t"e list o legal basis aut"oriBing t"e residentto reorganiBe any departent or agen!y in t"e e*e!utive bran!" does not "ave to end "ere. Ee ust not lose sig"t ot"e very sour!e o t"e power M t"at w"i!" !onstitutes ane*press grant o power. 0nder e!tion 51, 4oo2 III o

%*e!utive Order o. <9< (ot"erwise 2nown as t"e'dinistrative Code o 19?7), St"e resident, sub3e!t to t"e poli!y in t"e %*e!utive Oi!e and in order to a!"ievesipli!ity, e!onoy and ei!ien!y, s"all "ave t"e !ontinuingaut"ority to reorganiBe t"e adinistrative stru!ture o t"eOi!e o t"e resident. For t"is purpose, "e ay transer t"eun!tions o ot"er epartents or 'gen!ies to t"e Oi!e ot"e resident. In CanoniBado vs. 'guirre J5<5 C-' 51<K, weruled t"at reorganiBation Sinvolves t"e redu!tion o personnel!onsolidation o oi!es, or abolition t"ereo by reason oe!onoy or redundan!y o un!tions. It ta2es pla!e w"ent"ere is an alteration o t"e e*isting stru!ture o governentoi!es or units t"erein, in!luding t"e lines o !ontrol, aut"orityand responsibility between t"e. T"e %II4 is a bureau

atta!"ed to t"e epartent o Finan!e. It alls under t"eOi!e o t"e resident. en!e, it is sub3e!t to t"e residents!ontinuing aut"ority to reorganiBe.

WIt "aving been duly establis"ed t"at t"e resident "as t"eaut"ority to !arry out reorganiBation in any bran!" or agen!yo t"e e*e!utive departent, w"at is t"en let or us to resolveis w"et"er or not t"e reorganiBation is valid. In t"is 3urisdi!tion, reorganiBations "ave been regarded as valid provided t"ey are pursued in good ait". -eorganiBation is!arried out in Ygood ait" i it is or t"e purpose o e!onoyor to a2e bureau!ra!y ore ei!ient. ertinently, -epubli!'!t o. 66=6 provides or t"e !ir!ustan!es w"i!" ay be

!onsidered as eviden!e o bad ait" in t"e reoval o !ivilservi!e eployees ade as a result o reorganiBation, to wit*a, w"ere t"ere is a signii!ant in!rease in t"e nuber o positions in t"e new staing pattern o t"e departent oragen!y !on!erned; *b, w"ere an oi!e is abolis"ed andanot"er peroring substantially t"e sae un!tions is !reated*c, w"ere in!ubents are repla!ed by t"ose less ualiied inters o status o appointent, peroran!e and erit; *d,w"ere t"ere is a !lassii!ation o oi!es in t"e departent oragen!y !on!erned and t"e re!lassiied oi!es perorsubstantially t"e sae un!tions as t"e original oi!es, and *e,w"ere t"e reoval violates t"e order o separation.X?J?K

T"e Court o 'ppeals, in its now assailed de!ision, "as oundno eviden!e o bad ait" on t"e part o t"e T'; t"us #

WIn t"e !ase at bar, we ind no eviden!e t"at t"e respondents!oitted bad ait" in issuing t"e noti!es o non#appointentto t"e petitioners.

W Firstly, t"e nuber o positions in t"e new staing patterndid not in!rease. -at"er, it de!reased ro 1,1<= positions to

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7=>. It is t"us natural t"at ones position ay be lost t"roug"t"e reoval or abolition o an oi!e.

WSecondly, t"e petitioners ailed to spe!ii!ally s"ow w"i!"oi!es were abolis"ed and t"e new ones t"at were !reated peroring substantially t"e sae un!tions.

W!hirdly, t"e petitioners li2ewise ailed to prove t"at lessualiied eployees were appointed to t"e positions to w"i!"

t"ey applied.

W* * * * * * * * *.

W Fourthly, t"e preeren!e stated in e!tion A o -.'. 66=6,only eans t"at old eployees s"ould be !onsidered irst, butit does not ne!essarily ollow t"at t"ey s"ould t"enautoati!ally be appointed. T"is is be!ause t"e law does not pre!lude t"e inusion o new blood, younger dynais, or ne!essary talents into t"e governent servi!e, provided t"att"e a!ts o t"e appointing power are bonaide or t"e bestinterest o t"e publi! servi!e and t"e person !"osen "as t"eneeded ualii!ations.X9J9K

T"ese indings o t"e appellate !ourt are basi!ally a!tualw"i!" t"is Court ust respe!t and be "eld bound.

I+ i) i&por+%'+ +o *&p$%)i* +$%+ +$* *)+io'*( E5*/+i6*Or(*r) No. 29 %'( No. 3 $%6* 'o+ %oli)$*( +$* N%+io'%lTo%//o A(&i'i)+r%+io' + &*r*l &%'(%+*( i+)r*or%'i%+io' +$ro$ +$* )+r*%&li'i' or r*(/+io' o i+)p*r)o''*l. 'rti!le II, e!tion 17,1>J1>K o t"e Constitution,e*pressly grants t"e resident !ontrol o all e*e!utivedepartents, bureaus, agen!ies and oi!es w"i!" ay 3ustiyan e*e!utive a!tion to ina!tivate t"e un!tions o a parti!ular oi!e or to !arry out reorganiBation easures under a broad

aut"ority o law.11J11K e!tion 7? o t"e &eneral rovisions o -epubli! '!t o. ?=<< (&eneral 'ppropriations '!t o FL199?) "as de!reed t"at t"e resident ay dire!t !"anges in t"eorganiBation and 2ey positions in any departent, bureau or agen!y pursuant to 'rti!le I, e!tion <=,1<J1<K o t"eConstitution, w"i!" grants to t"e %*e!utive epartent t"eaut"ority to re!oend t"e budget ne!essary or its operation.%vidently, t"is grant o power in!ludes t"e aut"ority toevaluate ea!" and every governent agen!y, in!luding t"edeterination o t"e ost e!onoi!al and ei!ient staing pattern, under t"e %*e!utive epartent.

In t"e re!ent !ase o Rosa 1igaya C Domingo7 et al vs 6on

Ronaldo D Jamora7 in his capacity as the E%ecutiveSecretary7 et al 715J15K t"is Court "as "ad o!!asion to also

9

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delve on t"e residents power to reorganiBe t"e Oi!e o t"eresident under e!tion 51(<) and (5) o %*e!utive Order o<9< and t"e power to reorganiBe t"e Oi!e o t"e resident

Proper . T"e Court "as t"ere observed:

W* * *. 0nder e!tion 51(1) o %O <9<, t"e resident !anreorganiBe t"e Oi!e o t"e resident Proper by abolis"ing!onsolidating or erging units, or by transerring un!tionsro one unit to anot"er. In !ontrast, under e!tion 51(<) and

(5) o %O <9<, t"e residents power to reorganiBe oi!esoutside t"e Oi!e o t"e resident Proper but still wit"in t"eOi!e o t"e resident is liited to erely transerringun!tions or agen!ies ro t"e Oi!e o t"e resident toepartents or 'gen!ies, and vice versa.X

T"e provisions o e!tion 51, 4oo2 III, C"apter 1>, o%*e!utive Order o. <9< ('dinistrative Code o 19?7)above#reerred to, reads t"usly:

W%C. 51. Continuing 'ut"ority o t"e resident to-eorganiBe "is Oi!e. M T"e resident, sub3e!t to t"e poli!y int"e %*e!utive Oi!e and in order to a!"ieve sipli!ity

e!onoy and ei!ien!y, s"all "ave !ontinuing aut"ority toreorganiBe t"e adinistrative stru!ture o t"e Oi!e o t"eresident. For t"is purpose, "e ay ta2e any o t"e ollowinga!tions:

W(1) -estru!ture t"e internal organiBation o t"e Oi!e ot"e resident roper, in!luding t"e iediate Oi!es, t"eresidential pe!ial 'ssistants'dvisers yste and t"eCoon ta upport yste, by abolis"ing, !onsolidatingor erging units t"ereo or transerring un!tions ro oneunit to anot"er;

W(<) Transer any un!tion under t"e Oi!e o t"e

resident to any ot"er epartent or 'gen!y as well astranser un!tions to t"e Oi!e o t"e resident ro ot"erepartents and 'gen!ies; and

W(5) Transer any agen!y under t"e Oi!e o t"e residento any ot"er departent or agen!y as well as transer agen!iesto t"e Oi!e o t"e resident ro ot"er departents andagen!ies.X

T"e irst senten!e o t"e law is an e*press grant to t"eresident o a /o'+i'i' %+$ori+ +o r*or%'i* +$*%(&i'i)+r%+i6* )+r/+r* o +$* Oi/* o +$* #r*)i(*'+. T"esu!!eeding nubered paragrap"s are not in t"e nature o

provisos t"at unduly liit t"e ai and s!ope o t"e grant to t"eresident o t"e power to reorganiBe but are to be viewed in!onsonan!e t"erewit". e!tion 51(1) o %*e!utive Order o<9< spe!ii!ally reers to t"e residents power to restru!turet"e internal organiBation o t"e Oi!e o t"e resident Proper by abolis"ing, !onsolidating or erging units "ereo ortranserring un!tions ro one unit to anot"er, w"ile e!tion51(<) and (5) !on!ern e*e!utive oi!es outside t"e Oi!e ot"e resident Proper allowing t"e resident to transer anyun!tion under t"e Oi!e o t"e resident to any ot"eepartent or 'gen!y and vice;versa, and t"e transer o any

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agen!y under t"e Oi!e o t"e resident to any ot"er departent or agen!y and vice;versa.1AJ1AK

In t"e present instan!e, involving neit"er an abolition nor transer o oi!es, t"e assailed a!tion is a ere reorganiBationunder t"e general provisions o t"e law !onsisting ainly o )+r*%&li'i' t"e T' in t"e interest o sipli!ity, e!onoyand ei!ien!y. It is an a!t well wit"in t"e aut"ority o resident otivated and !arried out, a!!ording to t"e indings

o t"e appellate !ourt, in good ait", a a!tual assessent t"att"is Court !ould only but a!!ept.1=J1=K

In passing, relative to petitioners W+otion or an En anc-esolution o t"e Case,X it ay be well to reind !ounsel, t"att"e Court En anc is not an appellate tribunal to w"i!"appeals ro a ivision o t"e Court ay be ta2en. 'ivision o t"e Court is t"e upree Court as ully andveritably as t"e Court En anc itsel and a de!ision o itsivision is as aut"oritative and inal as a de!ision o t"e Court

En anc. -eerrals o !ases ro a ivision to t"e Court En

anc do not ta2e pla!e as 3ust a atter o routine but only onsu!" spe!iied grounds as t"e Court in its dis!retion ayallow.16J16K

;EREFORE, t"e +otion to 'dit etition or En ancresolution and t"e etition or an En anc -esolution are%I% or la!2 o erit. $et entry o 3udgent be ade indue !ourse. o !osts.

O O-%-%.

avide, 8r., C.8., (C"airan), Lnares#antiago, Carpio, and'B!una, 88., !on!ur.

YA>A=I 6). CA

GR NO. 130-4

FI-T IIIO

J&.-. o. 1=<?A=. 'ugust =, <>>5K

-I'IT' 4'&'OI', F%$L +'-I'&', I-$LT'&'4', -IC'-O '-'I, 0' I+%-I'$,4%8'+I %+%+, -OO$FO '&', %&'-O4'C$I&, &-%&O-IO $'4'L', I$'-IO 8%-%Q, and+'-I' CO-'QO C0''&, petitioners7 vs

'TIO'$ TO4'CCO '+IIT-'TIO, represented by'TOIO % &0Q+' and %-$IT' 4'0$',respondents

% C I I O

IT0&, 4 .:

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resident 8osep" %strada issued on 5> epteber 199?%*e!utive Order o. <9, entitled W+andating t"e trealiningo t"e ational Toba!!o 'dinistration (T'),X a governenagen!y under t"e epartent o 'gri!ulture. T"e order wasollowed by anot"er issuan!e, on <7 O!tober 199?, byresident %strada o %*e!utive Order o. 56, aending%*e!utive Order o. <9, insoar as t"e new staing patternwas !on!erned, by in!reasing ro our "undred (A>>) to noe*!eeding seven "undred ity (7=>) t"e positions ae!tedt"ereby. In !oplian!e t"erewit", t"e T' prepared andadopted a new OrganiBation tru!ture and taing attern(O) w"i!", on <9 O!tober 199?, was subitted to t"eOi!e o t"e resident.

On 11 oveber 199?, t"e ran2 and ile eployees o T'4ata!, aong w"o in!luded "erein petitioners, iled a letter#appeal wit" t"e Civil ervi!e Coission and soug"t itsassistan!e in re!alling t"e O. On >A e!eber 199?, t"eO was approved by t"e epartent o 4udget and+anageent (4+) sub3e!t to !ertain revisions. On evendate, t"e T' !reated a pla!eent !oittee to assist t"eappointing aut"ority in t"e sele!tion and pla!eent o peranent personnel in t"e revised O. T"e results o t"e

evaluation by t"e !oittee on t"e individual ualii!ations oappli!ants to t"e positions in t"e new O were t"endisseinated and posted at t"e !entral and provin!ial oi!eso t"e T'.

On 1> 8une 1996, petitioners, all o!!upying dierent positionsat t"e T' oi!e in 4ata!, Ilo!os orte, re!eived individuanoti!es o terination o t"eir eployent wit" t"e T'ee!tive t"irty (5>) days ro re!eipt t"ereo. Findingt"eselves wit"out any iediate relie ro t"eir disissaro t"e servi!e, petitioners iled a petition or certiorari pro"ibition and mandamus7 wit" prayer or preliinaryandatory in3un!tion andor teporary restraining order, wit"

t"e -egional Trial Court (-TC) o 4ata!, Ilo!os orte, and prayed #

W1) t"at a restraining order be iediately issueden3oining t"e respondents ro enor!ing t"e noti!e oterination addressed individually to t"e petitioners andorro !oitting urt"er a!ts o dispossession andor oustingt"e petitioners ro t"eir respe!tive oi!es;

W<) t"at a writ o preliinary in3un!tion be issued againstt"e respondents, !oanding t"e to aintain t"e status uoto prote!t t"e rig"ts o t"e petitioners pending t"edeterination o t"e validity o t"e ipleentation o t"eirdisissal ro t"e servi!e; and

W5) t"at, ater trial on t"e erits, 3udgent be renderedde!laring t"e noti!e o terination o t"e petitioners illegaand t"e reorganiBation null and void and ordering t"eirreinstateent wit" ba!2wages, i appli!able, !oanding t"erespondents to desist ro urt"er terinating t"eir servi!esand a2ing t"e in3un!tion peranent.X17J1K

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undisturbed and untou!"ed. In ot"er words, previousdo!trines and pre!edents o t"is ig"est Court would in ee!t be reversed andor odiied wit" t"e Court o 'ppeals 3udgent, s"ould it reain un!"allenged.

W5. e!tion A o %*e!utive Order o. <A= dated 8uly <A,19?7 ('nne* S, etition), issued by t"e -evolutionarygovernent o orer resident CoraBon 'uino, and t"e law!reating T', w"i!" provides t"at t"e governing body o T'

is t"e 4oard o ire!tors, would be rendered eaningless,inee!tive and a dead letter law be!ause t"e !"allenged T'reorganiBation w"i!" was erroneously up"eld by t"e Court o 'ppeals was adopted and ipleented by t"en T''dinistrator 'ntonio de &uBan wit"out t"e !orrespondingaut"ority ro t"e 4oard o ire!tors as andated t"erein. In brie, t"e reorganiBation is an ultra vires a!t o t"e T''dinistrator.

WA. T"e !"allenged %*e!utive Order o. <9 issued byorer resident 8osep" %strada but unsigned by t"en%*e!utive e!retary -onaldo Qaora would in ee!t beerroneously up"eld and given legal ee!t as to supersede,aend andor odiy %*e!utive Order o. <A=, a law issuedduring t"e Freedo Constitution o resident CoraBon'uino. In brie, a ere e*e!utive order would aend,supersede andor render inee!tive a law or statute.X<1J=K

In order to allow t"e parties a ull opportunity to ventilate t"eir views on t"e atter, t"e Court ultiately resolved to "ear t"e parties in oral arguent. %ssentially, t"e !ore uestion raised by t"e is w"et"er or not t"e resident, t"roug" t"e issuan!eo an e*e!utive order, !an validly !arry out t"e reorganiBationo t"e T'.

otwit"standing t"e apparent pro!edural lapse on t"e part o

petitioner to iplead t"e Oi!e o t"e resident as partyrespondent pursuant to e!tion 7, -ule 5, o t"e 1997 -evised-ules o Civil ro!edure, <<J6K t"is Court resolved to rule ont"e erits o t"e petition.

u8lod ng -a$aning EII vs Jamora<5J7K ruled t"at t"eresident, based on e*isting laws, "ad t"e aut"ority to !arryout a reorganiBation in any bran!" or agen!y o t"e e*e!utivedepartent. In said !ase, u8lod ng -a$aning EII!"allenged t"e issuan!e, and soug"t t"e nullii!ation, o %*e!utive Order o. 191 (ea!tivation o t"e %!onoi!Intelligen!e and Investigation 4ureau) and %*e!utive Order o. <<5 (uppleentary %*e!utive Order o. 191 on t"e

ea!tivation o t"e %!onoi! Intelligen!e and Investigation4ureau and or Ot"er +atters) on t"e ground t"at t"ey wereissued by t"e resident wit" grave abuse o dis!retion and inviolation o t"eir !onstitutional rig"t to se!urity o tenure. T"eCourt e*plained:

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WT"e general rule "as always been t"at t"e power to abolis" a publi! oi!e is lodged wit" t"e legislature. T"is pro!eedsro t"e legal pre!ept t"at t"e power to !reate in!ludes t"e power to destroy. ' publi! oi!e is eit"er !reated by t"eConstitution, by statute, or by aut"ority o law. T"us, e*!epw"ere t"e oi!e was !reated by t"e Constitution itsel, it ay be abolis"ed by t"e sae legislature t"at broug"t it intoe*isten!e.

WT"e e*!eption, "owever, is t"at as ar as bureaus, agen!ies oroi!es in t"e e*e!utive departent are !on!erned, t"eresidents power o !ontrol ay 3ustiy "i to ina!tivate t"eun!tions o a parti!ular oi!e, or !ertain laws ay grant "it"e broad aut"ority to !arry out reorganiBation easures. T"e!ase in point is 1arin v E%ecutive Secretary J<?> C-' 715KIn t"is !ase, it was argued t"at t"ere is no law w"i!"epowers t"e resident to reorganiBe t"e 4I-. In de!reeingot"erwise, t"is Court sustained t"e ollowing legal basis, t"us:

WYInitially, it is argued t"at t"ere is no law yet w"i!" epowerst"e resident to issue %.O. o. 15< or to reorganiBe t"e 4I-.

YEe do not agree.

Y* * * * * *

Ye!tion A? o -.'. 76A= provides t"at:

YYe!. A?. Scaling Do$n and Phase Out o' +ctivities o' +gencies ithin the E%ecutive ranch M T"e "eads odepartents, bureaus and oi!es and agen!ies are "erebydire!ted to identiy t"eir respe!tive a!tivities w"i!" are nolonger essential in t"e delivery o publi! servi!es and w"i!"ay be scaled do$n7 phased out or abolished7 sub3e!t to !iviservi!e rules and regulations. * * *. +ctual scaling do$n7

phasing out or abolition o t"e a!tivities s"all be ee!ted pursuant to Cir!ulars or Orders issued or t"e purpose by t"eOi!e o t"e resident.

Yaid provision !learly entions t"e a!ts o Y scaling do$n7

phasing out and abolition: o oi!es only and does not !overt"e !reation o oi!es or transer o un!tions. evert"elesst"e a!t o !reating and de!entraliBing is in!luded in t"esubseuent provision o e!tion 6< w"i!" provides t"at:

YYe!. 6<. 3nauthori2ed organi2ational changes M 0nlesot"erwise !reated by law or dire!ted by t"e resident o t"e"ilippines, no organiBational unit or !"anges in 2ey positions

in any departent or agen!y s"all be aut"oriBed in t"eirrespe!tive organiBation stru!tures and be unded roappropriations by t"is '!t.

N!he 'oregoing provision evidently sho$s that the President is

authori2ed to e''ect organi2ational changes including thecreation o' o''ices in the department or agency concerned

Y* * * * * *

Y'not"er legal basis o %.O. o. 15< is e!tion <>, 4oo2 III o%.O. o. <9< w"i!" states:





YYe!. <>. Residual Po$ers M 0nless Congress providesot"erwise, t"e resident s"all e*er!ise such other po$ers and

'unctions vested in the President $hich are provided 'or under the la$s and w"i!" are not spe!ii!ally enuerated above or w"i!" are not delegated by t"e resident in a!!ordan!e wit"law.

Y!his provision spea8s o' such other po$ers vested in the

President under the la$ hat la$ then gives him the po$er

to reorgani2eM It is Presidential Decree 5o "< $hichamended Presidential Decree 5o "="? !hese decrees

e%pressly grant the President o' the Philippines the continuing

authority to reorgani2e the national government7 $hichincludes the po$er to group7 consolidate bureaus and

agencies7 to abolish o''ices7 to trans'er 'unctions7 to create

and classi'y 'unctions7 services and activities and to

standardi2e salaries and materials T"e validity o t"ese twode!rees are unuestionable. T"e 19?7 Constitution !learly provides t"at Yall laws, de!rees, e*e!utive orders, pro!laations, letter o instru!tions and ot"er e*e!utiveissuan!es not in!onsistent wit" t"is Constitution s"all reainoperative until aended, repealed or revo2ed. o ar, t"ere isyet no law aending or repealing said de!rees.

Wow, let us ta2e a loo2 at t"e assailed e*e!utive order.

WIn t"e $hereas !lause o %.O. o. 191, orer resident%strada an!"ored "is aut"ority to dea!tivate %II4 on e!tion77 o -epubli! '!t ?7A= ( FL " General +ppropriations

+ct ), a provision siilar to e!tion 6< o -.'. 76A= uoted in 1arin, t"us:

WYe!. 77. Organi2ed Changes M 3nless ot"erwise provided by law or directed by the President o' the Philippines, no!"anges in 2ey positions or organiBational units in any

departent or agen!y s"all be aut"oriBed in t"eir respe!tiveorganiBational stru!tures and unded ro appropriations provided by t"is '!t.

WEe ad"ere to t"e * * * ruling in 1arin t"at t"is provisionre!ogniBes t"e aut"ority o t"e resident to ee!torganiBational !"anges in t"e departent or agen!y under t"ee*e!utive stru!ture. u!" a ruling urt"er inds support ine!tion 7? o -epubli! '!t o. ?76>. 0nder t"is law, t"e"eads o departents, bureaus, oi!es and agen!ies and ot"er entities in t"e %*e!utive 4ran!" are dire!ted (a) to !ondu!t a!opre"ensive review o t"is respe!tive andates, issions,ob3e!tives, un!tions, progras, pro3e!ts, a!tivities and

systes and pro!edures; (b) identiy a!tivities w"i!" are nolonger essential in t"e delivery o publi! servi!es and w"i!"ay be s!aled down, p"ased#out or abolis"ed; and (!) adopteasures t"at will result in t"e strealined organiBation andiproved overall peroran!e o t"eir respe!tive agen!ies.e!tion 7? ends up wit" t"e andate t"at t"e a!tualstrealining and produ!tivity iproveent in agen!yorganiBation and operation s"all be ee!ted pursuant toCir!ulars or Orders issued or t"e purpose by t"e Oi!e o t"eresident. T"e law "as spo2en !learly. Ee are let only wit"t"e duty to sustain.

W4ut o !ourse, t"e list o legal basis aut"oriBing t"e residentto reorganiBe any departent or agen!y in t"e e*e!utive bran!" does not "ave to end "ere. Ee ust not lose sig"t ot"e very sour!e o t"e power M t"at w"i!" !onstitutes ane*press grant o power. 0nder e!tion 51, 4oo2 III o%*e!utive Order o. <9< (ot"erwise 2nown as t"e'dinistrative Code o 19?7), St"e resident, sub3e!t to t"e poli!y in t"e %*e!utive Oi!e and in order to a!"ievesipli!ity, e!onoy and ei!ien!y, s"all "ave t"e !ontinuingaut"ority to reorganiBe t"e adinistrative stru!ture o t"eOi!e o t"e resident. For t"is purpose, "e ay transer t"eun!tions o ot"er epartents or 'gen!ies to t"e Oi!e ot"e resident. In CanoniBado vs. 'guirre J5<5 C-' 51<K, weruled t"at reorganiBation Sinvolves t"e redu!tion o personnel!onsolidation o oi!es, or abolition t"ereo by reason oe!onoy or redundan!y o un!tions. It ta2es pla!e w"ent"ere is an alteration o t"e e*isting stru!ture o governentoi!es or units t"erein, in!luding t"e lines o !ontrol, aut"orityand responsibility between t"e. T"e %II4 is a bureauatta!"ed to t"e epartent o Finan!e. It alls under t"eOi!e o t"e resident. en!e, it is sub3e!t to t"e residents!ontinuing aut"ority to reorganiBe.

WIt "aving been duly establis"ed t"at t"e resident "as t"eaut"ority to !arry out reorganiBation in any bran!" or agen!yo t"e e*e!utive departent, w"at is t"en let or us to resolveis w"et"er or not t"e reorganiBation is valid. In t"is 3urisdi!tion, reorganiBations "ave been regarded as valid provided t"ey are pursued in good ait". -eorganiBation is!arried out in Ygood ait" i it is or t"e purpose o e!onoyor to a2e bureau!ra!y ore ei!ient. ertinently, -epubli!'!t o. 66=6 provides or t"e !ir!ustan!es w"i!" ay be!onsidered as eviden!e o bad ait" in t"e reoval o !ivilservi!e eployees ade as a result o reorganiBation, to wit*a, w"ere t"ere is a signii!ant in!rease in t"e nuber o positions in t"e new staing pattern o t"e departent or

agen!y !on!erned; *b, w"ere an oi!e is abolis"ed andanot"er peroring substantially t"e sae un!tions is !reated*c, w"ere in!ubents are repla!ed by t"ose less ualiied inters o status o appointent, peroran!e and erit; *d,w"ere t"ere is a !lassii!ation o oi!es in t"e departent oragen!y !on!erned and t"e re!lassiied oi!es perorsubstantially t"e sae un!tions as t"e original oi!es, and *e,w"ere t"e reoval violates t"e order o separation.X<AJ?K

T"e Court o 'ppeals, in its now assailed de!ision, "as oundno eviden!e o bad ait" on t"e part o t"e T'; t"us #

WIn t"e !ase at bar, we ind no eviden!e t"at t"e respondents

!oitted bad ait" in issuing t"e noti!es o non#appointentto t"e petitioners.

W Firstly, t"e nuber o positions in t"e new staing patterndid not in!rease. -at"er, it de!reased ro 1,1<= positions to7=>. It is t"us natural t"at ones position ay be lost t"roug"t"e reoval or abolition o an oi!e.

24





WSecondly, t"e petitioners ailed to spe!ii!ally s"ow w"i!"oi!es were abolis"ed and t"e new ones t"at were !reated peroring substantially t"e sae un!tions.

W!hirdly, t"e petitioners li2ewise ailed to prove t"at lessualiied eployees were appointed to t"e positions to w"i!"t"ey applied.

W* * * * * * * * *.

W Fourthly, t"e preeren!e stated in e!tion A o -.'. 66=6,only eans t"at old eployees s"ould be !onsidered irst, butit does not ne!essarily ollow t"at t"ey s"ould t"enautoati!ally be appointed. T"is is be!ause t"e law does not pre!lude t"e inusion o new blood, younger dynais, or ne!essary talents into t"e governent servi!e, provided t"att"e a!ts o t"e appointing power are bonaide or t"e bestinterest o t"e publi! servi!e and t"e person !"osen "as t"eneeded ualii!ations.X<=J9K

T"ese indings o t"e appellate !ourt are basi!ally a!tualw"i!" t"is Court ust respe!t and be "eld bound.

I+ i) i&por+%'+ +o *&p$%)i* +$%+ +$* *)+io'*( E5*/+i6*Or(*r) No. 29 %'( No. 3 $%6* 'o+ %oli)$*( +$* N%+io'%lTo%//o A(&i'i)+r%+io' + &*r*l &%'(%+*( i+)r*or%'i%+io' +$ro$ +$* )+r*%&li'i' or r*(/+io' o i+)p*r)o''*l. 'rti!le II, e!tion 17,<6J1>K o t"e Constitution,e*pressly grants t"e resident !ontrol o all e*e!utivedepartents, bureaus, agen!ies and oi!es w"i!" ay 3ustiyan e*e!utive a!tion to ina!tivate t"e un!tions o a parti!ular oi!e or to !arry out reorganiBation easures under a broadaut"ority o law.<7J11K e!tion 7? o t"e &eneral rovisions o -epubli! '!t o. ?=<< (&eneral 'ppropriations '!t o FL199?) "as de!reed t"at t"e resident ay dire!t !"anges in t"e

organiBation and 2ey positions in any departent, bureau or agen!y pursuant to 'rti!le I, e!tion <=,<?J1<K o t"eConstitution, w"i!" grants to t"e %*e!utive epartent t"eaut"ority to re!oend t"e budget ne!essary or its operation.%vidently, t"is grant o power in!ludes t"e aut"ority toevaluate ea!" and every governent agen!y, in!luding t"edeterination o t"e ost e!onoi!al and ei!ient staing pattern, under t"e %*e!utive epartent.

In t"e re!ent !ase o Rosa 1igaya C Domingo7 et al vs 6on Ronaldo D Jamora7 in his capacity as the E%ecutive

Secretary7 et al 7<9J15K t"is Court "as "ad o!!asion to alsodelve on t"e residents power to reorganiBe t"e Oi!e o t"e

resident under e!tion 51(<) and (5) o %*e!utive Order o.<9< and t"e power to reorganiBe t"e Oi!e o t"e resident

Proper . T"e Court "as t"ere observed:

25

26

27

28

29

W* * *. 0nder e!tion 51(1) o %O <9<, t"e resident !anreorganiBe t"e Oi!e o t"e resident Proper by abolis"ing!onsolidating or erging units, or by transerring un!tionsro one unit to anot"er. In !ontrast, under e!tion 51(<) and(5) o %O <9<, t"e residents power to reorganiBe oi!esoutside t"e Oi!e o t"e resident Proper but still wit"in t"eOi!e o t"e resident is liited to erely transerringun!tions or agen!ies ro t"e Oi!e o t"e resident toepartents or 'gen!ies, and vice versa.X

T"e provisions o e!tion 51, 4oo2 III, C"apter 1>, o%*e!utive Order o. <9< ('dinistrative Code o 19?7)above#reerred to, reads t"usly:

W%C. 51. Continuing 'ut"ority o t"e resident to-eorganiBe "is Oi!e. M T"e resident, sub3e!t to t"e poli!y int"e %*e!utive Oi!e and in order to a!"ieve sipli!itye!onoy and ei!ien!y, s"all "ave !ontinuing aut"ority toreorganiBe t"e adinistrative stru!ture o t"e Oi!e o t"eresident. For t"is purpose, "e ay ta2e any o t"e ollowinga!tions:

W(1) -estru!ture t"e internal organiBation o t"e Oi!e ot"e resident roper, in!luding t"e iediate Oi!es, t"eresidential pe!ial 'ssistants'dvisers yste and t"eCoon ta upport yste, by abolis"ing, !onsolidatingor erging units t"ereo or transerring un!tions ro oneunit to anot"er;

W(<) Transer any un!tion under t"e Oi!e o t"eresident to any ot"er epartent or 'gen!y as well astranser un!tions to t"e Oi!e o t"e resident ro ot"erepartents and 'gen!ies; and

W(5) Transer any agen!y under t"e Oi!e o t"e residen

to any ot"er departent or agen!y as well as transer agen!iesto t"e Oi!e o t"e resident ro ot"er departents andagen!ies.X

T"e irst senten!e o t"e law is an e*press grant to t"eresident o a /o'+i'i' %+$ori+ +o r*or%'i* +$*%(&i'i)+r%+i6* )+r/+r* o +$* Oi/* o +$* #r*)i(*'+. T"esu!!eeding nubered paragrap"s are not in t"e nature o

provisos t"at unduly liit t"e ai and s!ope o t"e grant to t"eresident o t"e power to reorganiBe but are to be viewed in!onsonan!e t"erewit". e!tion 51(1) o %*e!utive Order o<9< spe!ii!ally reers to t"e residents power to restru!turet"e internal organiBation o t"e Oi!e o t"e resident Proper

by abolis"ing, !onsolidating or erging units "ereo ortranserring un!tions ro one unit to anot"er, w"ile e!tion51(<) and (5) !on!ern e*e!utive oi!es outside t"e Oi!e ot"e resident Proper allowing t"e resident to transer anyun!tion under t"e Oi!e o t"e resident to any ot"eepartent or 'gen!y and vice;versa, and t"e transer o anyagen!y under t"e Oi!e o t"e resident to any ot"edepartent or agen!y and vice;versa.5>J1AK

In t"e present instan!e, involving neit"er an abolition notranser o oi!es, t"e assailed a!tion is a ere reorganiBation

30











under t"e general provisions o t"e law !onsisting ainly o )+r*%&li'i' t"e T' in t"e interest o sipli!ity, e!onoyand ei!ien!y. It is an a!t well wit"in t"e aut"ority o resident otivated and !arried out, a!!ording to t"e indingso t"e appellate !ourt, in good ait", a a!tual assessent t"att"is Court !ould only but a!!ept.51J1=K

In passing, relative to petitioners W+otion or an En anc-esolution o t"e Case,X it ay be well to reind !ounsel, t"at

t"e Court En anc is not an appellate tribunal to w"i!"appeals ro a ivision o t"e Court ay be ta2en. 'ivision o t"e Court is t"e upree Court as ully andveritably as t"e Court En anc itsel and a de!ision o itsivision is as aut"oritative and inal as a de!ision o t"e Court

En anc. -eerrals o !ases ro a ivision to t"e Court En

anc do not ta2e pla!e as 3ust a atter o routine but only onsu!" spe!iied grounds as t"e Court in its dis!retion ayallow.5<J16K

;EREFORE, t"e +otion to 'dit etition or En anc

resolution and t"e etition or an En anc -esolution are%I% or la!2 o erit. $et entry o 3udgent be ade indue !ourse. o !osts.

O O-%-%.

avide, 8r., C.8., (C"airan), Lnares#antiago, Carpio, and'B!una, 88., !on!ur.


% 4'C

G.R. No. 12430 No6*&*r -, 1997

FRANCISCO S. TATA", petitioner,vs.TE SECRETARY OF TE "E#ARTMENT OFENERGY AN" TE SECRETARY OF TE"E#ARTMENT OF FINANCE, respondents.

G.R. No. 1277 No6*&*r -, 1997

E"CEL C. LAGMAN, JO=ER #. ARROYO, ENRIDUEGARCIA, ;IG!ERTO TANA"A, FLAG UMANRIGTS FOUN"ATION, INC., FREE"OM FROM"E!T COALITION ?F"C@, SANLA=AS, petitioners,vs.ON. RU!EN TORRES i' $i) /%p%/i+ %) +$* E5*/+i6*S*/r*+%r, ON. FRANCISCO IRAY, i' $i) /%p%/i+ %)

31

32

+$* S*/r*+%r o E'*r, CALTE #$ilippi'*), I'/.#ETRON Corpor%+io' %'( #ILI#INAS SELLCorpor%+io', respondents.

#UNO, J.:

T"e petitions at bar !"allenge t"e !onstitutionality o -epubli!

'!t o. ?1?> entitled 'n '!t eregulating t"e ownstreaOil Industry and For Ot"er urposes. 1 -.'. o. ?1?> endstwenty si* (<6) years o governent regulation o t"edownstrea oil industry. Few !ases !arry a surpassingiportan!e on t"e lie o every Filipino as t"ese petitions ort"e upswing and downswing o our e!onoy ateriallydepend on t"e os!illation o oil.

First, t"e a!ts wit"out t"e at. Prior to "", t"ere was nogovernent agen!y regulating t"e oil industry ot"er t"an t"osedealing wit" ordinary !oodities. Oil !opanies were reeto enter and e*it t"e ar2et wit"out any governenintereren!e. T"ere were our (A) reining !opanies ("ell

Calte*, 4ataan -eining Copany and Filoil -eining) and si*(6) petroleu ar2eting !opanies (%sso, Filoil, Calte*&etty, +obil and "ell), t"en operating in t"e !ountry. 2

In "", t"e !ountry was driven to its 2nees by a !rippling oil!risis. T"e governent, realiBing t"at petroleu and its produ!ts are vital to national se!urity and t"at t"eir !ontinuedsupply at reasonable pri!es is essential to t"e general welareena!ted t"e Oil Industry Coission '!t. 3 It !reated t"e Oi

Industry Commission (OIC) to regulate t"e business oiporting, e*porting, re#e*porting, s"ipping, transporting pro!essing, reining, storing, distributing, ar2eting andselling !rude oil, gasoline, 2erosene, gas and ot"er reined

petroleu produ!ts. T"e OIC was vested wit" t"e po$er to 'i%t"e ar2et prices o petroleu produ!ts, to regulate t"e!apa!ities o reineries, to li!ense new reineries and toregulate t"e operations and trade pra!ti!es o t"e industry. 4

In addition to t"e !reation o t"e OIC, t"e governent saw t"eiperious need or a ore a!tive role o Filipinos in t"e oilindustry. 3ntil the early seventies7 the do$nstream oil industry

$as controlled by multinational companies. 'll t"e oireineries and ar2eting !opanies were owned by 'oreignersw"ose e!onoi! interests did not always !oin!ide wit" t"einterest o t"e Filipino. Crude oil was transported to t"e!ountry by oreign#!ontrolled tan2ers. Crude pro!essing was

done lo!ally by oreign#owned reineries and petroleu produ!ts were ar2eted t"roug" oreign#owned retail outletsOn oveber 9, 1975, resident Ferdinand %. +ar!os boldly!reated t"e "ilippine ational Oil Corporation (OC) to brea2 t"e !ontrol by oreigners o our oil industry. - OCengaged in t"e business o reining, ar2eting, s"ippingtransporting, and storing petroleu. It a!uired owners"ip o%O "ilippines and Filoil to serve as its ar2eting ar. It boug"t t"e !ontrolling s"ares o 4ataan -eining Corporationt"e largest reinery in t"e !ountry. OC later put up its ownar2eting subsidiary @ etrop"il. OC operated under t"e business nae %T-O Corporation. For t"e irst tie, t"erewas a Filipino presen!e in t"e "ilippine oil ar2et.



In 19?A, resident +ar!os t"roug" e!tion ? o residentiale!ree o. 19=6, !reated t"e Oil Price Stabili2ation Fund (OF) to !us"ion t"e ee!ts o reuent !"anges in t"e pri!eo oil !aused by e*!"ange rate ad3ustents or in!rease in t"eworld ar2et pri!es o !rude oil and iported petroleu produ!ts. T"e und is used (1) to reiburse t"e oil !opaniesor !ost in!reases in !rude oil and iported petroleu produ!ts resulting ro e*!"ange rate ad3ustent andor in!rease in world ar2et pri!es o !rude oil, and (<) toreiburse oil !opanies or !ost underre!overy in!urred as aresult o t"e redu!tion o doesti! pri!es o petroleu produ!ts. 0nder t"e law, t"e OF ay be sour!ed ro:

1. any in!rease in t"e ta* !olle!tion ro advalore ta* or !ustos duty iposed on petroleu produ!ts sub3e!t to ta* under .. o. 19=6 arising ro e*!"ange ratead3ustent,

<. any in!rease in t"e ta* !olle!tion as aresult o t"e liting o ta* e*eptions o governent !orporations, as ay bedeterined by t"e +inister o Finan!e in!onsultation wit" t"e 4oard o %nergy,

5. any additional aount to be iposed on petroleu produ!ts to augent t"e resour!eso t"e und t"roug" an appropriate order t"atay be issued by t"e 4oard o %nergyreuiring payent o persons or !opaniesengaged in t"e business o iporting,anua!turing andor ar2eting petroleu produ!ts, or

A. any resulting peso !osts dierentials in

!ase t"e a!tual peso !osts paid by oil!opanies in t"e iportation o !rude oiland petroleu produ!ts is less t"an t"e peso!osts !oputed using t"e reeren!e oreigne*!"ange rate as i*ed by t"e 4oard o %nergy. 7

y "B, only t"ree (5) oil !opanies were operating in t"e!ountry @ Calte*, "ell and t"e governent#owned OC.

In 9ay7 " , resident CoraBon C. 'uino signed %*e!utiveOrder o. 17< !reating t"e Energy Regulatory oard toregulate t"e business o iporting, e*porting, re#e*porting,

s"ipping, transporting, pro!essing, reining, ar2eting anddistributing energy resour!es w"en warranted and only w"en publi! ne!essity reuires. T"e 4oard "ad t"e ollowing powers and un!tions:

1. Fi* and regulate t"e pri!es o petroleu produ!ts;

<. Fi* and regulate t"e rate s!"edule or pri!es o piped gas to be !"arged by duly ran!"ised gas !opanies w"i!" distributegas by eans o underground pipe syste;

5. Fi* and regulate t"e rates o pipeline !on!essionaries undert"e provisions o -.'. o. 5?7, as aended . . . ;

A. -egulate t"e !apa!ities o new reineries or additiona!apa!ities o e*isting reineries and li!ense reineries t"at ay be organiBed ater t"e issuan!e o (%.O. o. 17<) under su!"ters and !onditions as are !onsistent wit" t"e nationainterest; and

=. E"enever t"e 4oard "as deterined t"at t"ere is a s"ortageo any petroleu produ!t, or w"en publi! interest so reuires,it ay ta2e su!" steps as it ay !onsider ne!essary, in!ludingt"e teporary ad3ustent o t"e levels o pri!es o petroleu produ!ts and t"e payent to t"e Oil ri!e tabiliBationFund . . . by persons or entities engaged in t"e petroleuindustry o su!" aounts as ay be deterined by t"e 4oardw"i!" ay enable t"e iporter to re!over its !ost oiportation.

On December 7 "<, Congress ena!ted -.'. o. 765? w"i!"!reated t"e Department o' Energy to prepare, integrate!oordinate, supervise and !ontrol all plans, progras, pro3e!ts

and a!tivities o t"e governent in relation to energye*ploration, developent, utiliBation, distribution and!onservation. 9 T"e t"rust o t"e "ilippine energy prograunder t"e law was toward privati2ation o governenagen!ies related to energy, deregulation o t"e power andenergy industry and redu!tion o dependen!y on oil#ired plants. 10 T"e law also aied to en!ourage ree and a!tive parti!ipation and investent by t"e private se!tor in all energya!tivities. e!tion =(e) o t"e law states t"at at t"e end o our(A) years ro t"e ee!tivity o t"is '!t, t"e epartent s"allupon approval o t"e resident, institute t"e progras andtimetable o' deregulation o appropriate energy pro3e!ts anda!tivities o t"e energy industry.

ursuant to t"e poli!ies enun!iated in -.'. o. 765?, t"egovernent approved t"e privati2ation o' Petron Corporation

in 1995. On e!eber 16, 1995, OC sold A>G o its euityin etron Corporation to t"e 'ra!o Overseas Copany.

In 9arch "? , Congress too2 t"e auda!ious step oderegulating the do$nstream oil industry. It ena!ted R. +. 5o">, entitled t"e ownstrea Oil Industry eregulation '!o 1996. 0nder t"e deregulated environent, any person orentity ay iport or pur!"ase any uantity o !rude oil and petroleu produ!ts ro a oreign or doesti! sour!e, lease orown and operate reineries and ot"er downstrea oil a!ilities

and ar2et su!" !rude oil or use t"e sae or "is ownreuireent, sub3e!t only to onitoring by t"e epartent o

%nergy. 11

!he deregulation process has t$o phases: the transition phase

and the 'ull deregulation phase. uring t"e transition p"asecontrols o' the non;pricing aspects o t"e oil industry were to be lited. T"e ollowing were to be a!!oplis"ed: (1)liberaliBation o oil iportation, e*portation, anua!turingar2eting and distribution, (<) ipleentation o anautoati! pri!ing e!"anis, (5) ipleentation o anautoati! orula to set argins o dealers and rates o



"aulers, water transport operators and pipeline!on!essionaires, and (A) restru!turing o oil ta*es. 0pon ullderegulation, controls on the price o' oil and t"e oreigne*!"ange !over were to be lited and t"e OF was to beabolis"ed.

T"e irst p"ase o deregulation !oen!ed on 'ugust 1<,1996.

On February 7 "7 the President implemented the 'ull deregulation o' the Do$nstream Oil Industry through E .O. 5o.<.

T"e petitions at bar assail t"e !onstitutionality o various provisions o -.' o. ?1?> and %.O. o. 57<.

In G. R. 5o. "<=?>, petitioner Fran!is!o . Tatad see2s t"eannulent o se!tion =(b) o -.'. o. ?1?>. e!tion =(b) provides:

b) 'ny law to t"e !ontrary notwit"standing andstarting wit" t"e ee!tivity o t"is '!t, tari duty

s"all be iposed and !olle!ted on iported !rude oilat t"e rate o t"ree per!ent (5G) and iported reined petroleu produ!ts at t"e rate o seven per!ent (7G),e*!ept uel oil and $&, t"e rate or w"i!" s"all bet"e sae as t"at or iported !rude oil: rovided,T"at beginning on 8anuary 1, <>>A t"e tari rate oniported !rude oil and reined petroleu produ!tss"all be t"e sae: Provided7 'urther , T"at t"is provision ay be aended only by an '!t o Congress.

T"e petition is an!"ored on t"ree arguents:

First, t"at t"e iposition o dierent tari rates on iported!rude oil and iported reined petroleu produ!ts violates t"eeual prote!tion !lause. etitioner !ontends t"at t"e 5G#7Gtari dierential unduly avors t"e t"ree e*isting oil reineriesand dis!riinates against prospe!tive investors in t"edownstrea oil industry w"o do not "ave t"eir own reineriesand will "ave to sour!e reined petroleu produ!ts roabroad.

e!ond, t"at t"e iposition o dierent tari rates does notderegulate t"e downstrea oil industry but instead !ontrols t"eoil industry, !ontrary to t"e avowed poli!y o t"e law.etitioner avers t"at t"e tari dierential between iported

!rude oil and iported reined petroleu produ!ts bars t"eentry o ot"er players in t"e oil industry be!ause it ee!tively prote!ts t"e interest o oil !opanies wit" e*isting reineries.T"us, it runs !ounter to t"e ob3e!tive o t"e law to oster atruly !opetitive ar2et.

T"ird, t"at t"e in!lusion o t"e tari provision in se!tion =(b)o -.'. o. ?1?> violates e!tion <6(1) 'rti!le I o t"eConstitution reuiring every law to "ave only one sub3e!tw"i!" s"all be e*pressed in its title. etitioner !ontends t"att"e iposition o tari rates in se!tion =(b) o -.'. o. ?1?>

is oreign to t"e sub3e!t o t"e law w"i!" is t"e deregulation ot"e downstrea oil industry.

In G. R. 5o. "<? , petitioners %d!el C. $agan, 8o2er 'rroyo, %nriue &ar!ia, Eigberto Tanada, Flag uan -ig"tsFoundation, In!., Freedo ro ebt Coalition (FC) andanla2as !ontest t"e !onstitutionality o se!tion 1= o -.' o. ?1?> and %.O. o. 59<. e!tion 1= provides:

e!. 1=. Ipleentation o Full eregulation. @ursuant to e!tion =(e) o -epubli! '!t o. 765?t"e O% s"all, upon approval o t"e residentipleent t"e ull deregulation o t"e downstreaoil industry not later t"an +ar!" 1997. 's ar as pra!ti!able, t"e O% s"all tie t"e ull deregulationw"en t"e pri!es o !rude oil and petroleu produ!tin t"e world ar2et are de!lining and w"en t"ee*!"ange rate o t"e peso in relation to t"e 0 dollaris stable. 0pon t"e ipleentation o t"e ulderegulation as provided "erein, t"e transition p"aseis deeed terinated and t"e ollowing laws aredeeed repealed:

*** *** ***

%.O. o. 57< states in ull, vi2 .:

E%-%', -epubli! '!t o. 765?, ot"erwise2nown as t"e epartent o %nergy '!t o 199<, provides t"at, at t"e end o our years ro itsee!tivity last e!eber 199<, t"e epartent (o%nergy) s"all, upon approval o t"e residentinstitute t"e progras and tie table o deregulationo appropriate energy pro3e!ts and a!tivities o t"eenergy se!tor;

E%-%', e!tion 1= o -epubli! '!t o. ?1?>,ot"erwise 2nown as t"e ownstrea Oil Industryeregulation '!t o 1996, provides t"at t"e O%s"all, upon approval o t"e resident, ipleent ulderegulation o t"e downstrea oil industry not latert"an +ar!", 1997. 's ar as pra!ti!able, t"e O%s"all tie t"e ull deregulation w"en t"e pri!es o!rude oil and petroleu produ!ts in t"e world ar2etare de!lining and w"en t"e e*!"ange rate o t"e pesoin relation to t"e 0 dollar is stable;

E%-%', pursuant to t"e re!oendation o t"e

epartent o %nergy, t"ere is an iperative need toipleent t"e ull deregulation o t"e downstreaoil industry be!ause o t"e ollowing re!endevelopents: (i) depletion o t"e buer und on orabout 7 February 1997 pursuant to t"e %nergy-egulatory 4oardDs Order dated 16 8anuary 1997; (ii)t"e pri!es o !rude oil "ad been stable at Z<1#Z<5 per barrel sin!e O!tober 1996 w"ile pri!es o petroleu produ!ts in t"e world ar2et "ad been stable sin!eid#e!eber o last year. +oreover, !rude oi pri!es are beginning to soten or t"e last ew daysw"ile pri!es o soe petroleu produ!ts "ad alreadyde!lined; and (iii) t"e e*!"ange rate o t"e peso in



relation to t"e 0 dollar "as been stable or t"e pasttwelve (1<) ont"s, averaging at around <6.<> toone 0 dollar;

E%-%', %*e!utive Order o. 577 dated 51O!tober 1996 provides or an institutional raewor2 or t"e adinistration o t"e deregulated industry bydeining t"e un!tions and responsibilities o variousgovernent agen!ies;

E%-%', pursuant to -epubli! '!t o. ?1?>, t"ederegulation o t"e industry will oster a truly!opetitive ar2et w"i!" !an better a!"ieve t"eso!ial poli!y ob3e!tives o air pri!es and adeuate,!ontinuous supply o environentally#!lean and "ig"uality petroleu produ!ts;

OE, T%-%FO-%, I, FI%$ . -'+O,resident o t"e -epubli! o t"e "ilippines, by t"e powers vested in e by law, do "ereby de!lare t"eull deregulation o t"e downstrea oil industry.

In assailing se!tion 1= o -.'. o. ?1?> and %.O. o. 59<, petitioners oer t"e ollowing subissions:

First, se!tion 1= o -.'. o. ?1?> !onstitutes an unduedelegation o legislative power to t"e resident and t"ee!retary o %nergy be!ause it does not provide a deterinateor deterinable standard to guide t"e %*e!utive 4ran!" indeterining w"en to ipleent t"e ull deregulation o t"edownstrea oil industry. etitioners !ontend t"at t"e law doesnot deine w"en it is pra!ti!able or t"e e!retary o %nergy tore!oend to t"e resident t"e ull deregulation o t"edownstrea oil industry or w"en t"e resident ay !onsider it pra!ti!able to de!lare ull deregulation. 'lso, t"e law does not

provide any spe!ii! standard to deterine w"en t"e pri!es o !rude oil in t"e world ar2et are !onsidered to be de!liningnor w"en t"e e*!"ange rate o t"e peso to t"e 0 dollar is!onsidered stable.

e!ond, petitioners aver t"at %.O. o. 59< ipleenting t"eull deregulation o t"e downstrea oil industry is arbitraryand unreasonable be!ause it was ena!ted due to t"e allegeddepletion o t"e OF und @ a !ondition not ound in -.'. o. ?1?>.

T"ird, se!tion 1= o -.'. o. ?1?> and %.O. o. 59< allow t"eoration o a de 'acto !artel aong t"e t"ree e*isting oil

!opanies @ etron, Calte* and "ell @ in violation o t"e!onstitutional pro"ibition against onopolies, !obinations inrestraint o trade and unair !opetition.

-espondents, on t"e ot"er "and, ervently deend t"e!onstitutionality o -.'. o. ?1?> and %.O. o. 59<. Inaddition, respondents !ontend t"at t"e issues raised by t"e petitions are not 3usti!iable as t"ey pertain to t"e wisdo o t"e law. -espondents urt"er aver t"at petitioners "ave nolocus standi as t"ey did not sustain nor will t"ey sustain dire!tin3ury as a result o t"e ipleentation o -.'. o. ?1?>.

T"e petitions were "eard by t"e Court on epteber 5>, 1997On O!tober 7, 1997, t"e Court ordered t"e private respondentsoil !opanies to aintain t"e status uo and to !ease anddesist ro in!reasing t"e pri!es o gasoline and ot"er petroleu uel produ!ts or a period o t"irty (5>) days . . sub3e!t to urt"er orders as !onditions ay warrant.

Ee s"all now resolve t"e petitions on t"e erit. T"e petitionsraise pro!edural and substantive issues bearing on t"e

!onstitutionality o -.'. o. ?1?> and %.O. o. 59<. T"e procedural issues are: (1) w"et"er or not t"e petitions raise a 3usti!iable !ontroversy, and (<) w"et"er or not t"e petitioners"ave t"e standing to assail t"e validity o t"e sub3e!t law ande*e!utive order. T"e substantive issues are: (1) w"et"er or notse!tion = (b) violates t"e one title @ one sub3e!t reuireento t"e Constitution; (<) w"et"er or not t"e sae se!tionviolates t"e eual prote!tion !lause o t"e Constitution; (5)w"et"er or not se!tion 1= violates t"e !onstitutiona pro"ibition on undue delegation o power; (A) w"et"er or no%.O. o. 59< is arbitrary and unreasonable; and (=) w"et"er ornot -.'. o. ?1?> violates t"e !onstitutional pro"ibitionagainst onopolies, !obinations in restraint o trade andunair !opetition.

Ee s"all irst ta!2le t"e pro!edural issues. -espondents !lait"at t"e avalan!"e o arguents o t"e petitioners assail t"ewisdo o -.'. o. ?1?>. T"ey aver t"at deregulation o t"edownstrea oil industry is a poli!y de!ision ade byCongress and it !annot be reviewed, u!" less be reversed byt"is Court. In !onstitutional parlan!e, respondents !ontend t"att"e petitions ailed to raise a 3usti!iable !ontroversy.

-espondentsD 3oint stan!e is unnotewort"y. 8udi!ial powein!ludes not only t"e duty o t"e !ourts to settle a!tua!ontroversies involving rig"ts w"i!" are legally deandableand enor!eable, but also t"e duty to deterine w"et"er or nott"ere "as been grave abuse o dis!retion aounting to la!2 ore*!ess o 3urisdi!tion on t"e part o any bran!" orinstruentality o t"e governent. 1 2 T"e !ourts, as guardianso t"e Constitution, "ave t"e in"erent aut"ority to deterinew"et"er a statute ena!ted by t"e legislature trans!ends t"eliit iposed by t"e undaental law. E"ere a statute violatest"e Constitution, it is not only t"e rig"t but t"e duty o t"e 3udi!iary to de!lare su!" a!t as un!onstitutional and void. 1

Ee "eld in t"e re!ent !ase o !anada v. +ngara: 14

*** *** ***

In see2ing to nulliy an a!t o t"e "ilippine enateon t"e ground t"at it !ontravenes t"e Constitution, t"e petition no doubt raises a 3usti!iable !ontroversyE"ere an a!tion o t"e legislative bran!" is seriouslyalleged to "ave inringed t"e Constitution, it be!oesnot only t"e rig"t but in a!t t"e duty o t"e 3udi!iaryto settle t"e dispute. T"e uestion t"us posed is 3udi!ial rat"er t"an politi!al. T"e duty to ad3udi!atereains to assure t"at t"e suprea!y o t"eConstitution is up"eld. On!e a !ontroversy as to t"eappli!ation or interpretation o a !onstitutiona provision is raised beore t"is Court, it be!oes a



legal issue w"i!" t"e Court is bound by !onstitutionalandate to de!ide.

%ven a sideglan!e at t"e petitions will reveal t"at petitioners"ave raised !onstitutional issues w"i!" deserve t"e resolutiono t"is Court in view o t"eir seriousness and t"eir value as pre!edents. Our stateent o a!ts and deinition o issues!learly s"ow t"at petitioners are assailing -.'. o. ?1?> be!ause its provisions inringe t"e Constitution and not

be!ause t"e law la!2s wisdo. T"e prin!iple o separation o power andates t"at !"allenges on t"e !onstitutionality o alaw s"ould be resolved in our !ourts o 3usti!e w"ile doubts ont"e wisdo o a law s"ould be debated in t"e "alls o Congress. %very now and t"en, a law ay be denoun!ed in!ourt bot" as beret o wisdo and !onstitutionally inired.u!" denun!iation will not deny t"is Court o its 3urisdi!tionto resolve t"e !onstitutionality o t"e said law w"ile prudentially reusing to pass on its wisdo.

T"e eort o respondents to uestion t"e locus standi o petitioners ust also all on barren ground. In language toolu!id to be isunderstood, t"is Court "as brig"tlined its liberalstan!e on a petitionerDs locus standi w"ere t"e petitioner isable to !rat an issue o trans!endental signii!an!e to t"e people. 1- In -apatiran ng mga 5agliling8od sa Pamahalaan

ng Pilipinas7 Inc. v. !an, 1 we stressed:

*** *** ***

Ob3e!tions to ta*payersD suit or la!2 o sui!ient personality, standing or interest are, "owever, in t"eain pro!edural atters. Considering t"e iportan!eto t"e publi! o t"e !ases at bar, and in 2eeping wit"t"e CourtDs duty, under t"e 19?7 Constitution, todeterine w"et"er or not t"e ot"er bran!"es o

governent "ave 2ept t"eselves wit"in t"e liits o t"e Constitution and t"e laws and t"at t"ey "ave notabused t"e dis!retion given to t"e, t"e Court "as brus"ed aside te!"ni!alities o pro!edure and "asta2en !ogniBan!e o t"ese petitions.

T"ere is not a dot o disagreeent between t"e petitioners andt"e respondents on t"e ar rea!"ing iportan!e o t"e validityo -' o. ?1?> deregulating our downstrea oil industry.T"us, t"ere is no good sense in being "yperte!"ni!al on t"estanding o petitioners or t"ey pose issues w"i!" aresignii!ant to our people and w"i!" deserve our ort"rig"tresolution.

Ee s"all now tra!2 down t"e substantive issues. In &.-. o.1<A56> w"ere petitioner is enator Tatad, it is !ontended t"atse!tion =(b) o -.'. o. ?1?> on tari dierential violates t"e provision 17 o t"e Constitution reuiring every law to "aveonly one sub3e!t w"i!" s"ould be e*pressed in its title. Ee donot !on!ur wit" t"is !ontention. 's a poli!y, t"is Court "asadopted a liberal !onstru!tion o t"e one title @ one sub3e!trule. Ee "ave !onsistently ruled 1 t"at t"e title need notirror, ully inde* or !atalogue all !ontents and inute detailso a law. ' law "aving a single general sub3e!t indi!ated in t"etitle ay !ontain any nuber o provisions, no atter "owdiverse t"ey ay be, so long as t"ey are not in!onsistent wit"

or oreign to t"e general sub3e!t, and ay be !onsidered inurt"eran!e o su!" sub3e!t by providing or t"e et"od andeans o !arrying out t"e general sub3e!t. 19 Ee "old t"ase!tion =(b) providing or tari dierential is gerane to t"esub3e!t o -.'. o. ?1?> w"i!" is t"e deregulation o t"edownstrea oil industry. T"e se!tion is supposed to sway prospe!tive investors to put up reineries in our !ountry anda2e t"e rely less on iported petroleu. 20 Ee s"all"owever, return to t"e validity o t"is provision w"en wee*aine its blo!2ing ee!t on new entrants to t"e oil ar2et.

Ee s"all now slide to t"e substantive issues in &.-. o1<7?67. etitioners assail se!tion 1= o -.'. o. ?1?> w"i!"i*es t"e tie rae or t"e ull deregulation o t"edownstrea oil industry. Ee restate its pertinent portion orep"asis, vi2 .:

e!. 1=. Ipleentation o Full eregulation @ursuant to se!tion =(e) o -epubli! '!t o. 765?t"e O% s"all, upon approval o t"e residentipleent t"e ull deregulation o t"e downstreaoil industry not later t"an +ar!" 1997. +s 'ar as

practicable, t"e O% s"all tie t"e ull deregulationw"en t"e pri!es o !rude oil and petroleu produ!tin t"e world ar2et are declining and w"en t"ee*!"ange rate o t"e peso in relation to t"e 0 dollaris stable . . .

etitioners urge t"at t"e p"rases as ar as pra!ti!able,de!line o !rude oil pri!es in t"e world ar2et and stabilityo t"e peso e*!"ange rate to t"e 0 dollar are abivalent,un!lear and in!on!rete in eaning. T"ey subit t"at t"ey donot provide t"e deterinate or deterinable standards w"i!"!an guide t"e resident in "is de!ision to ully deregulate t"edownstrea oil industry. In addition, t"ey !ontend t"at %.O o. 59< w"i!" advan!ed t"e date o ull deregulation is voidor it illegally !onsidered t"e depletion o t"e OF und as aa!tor.

T"e power o Congress to delegate t"e e*e!ution o laws "aslong been settled by t"is Court. 's early as 1916 in CompaniaGeneral de !abacos de Filipinas vs. !he oard o' Public

3tility Commissioners, 21 t"is Court t"ru, +r. 8usti!e+oreland, "eld t"at t"e true distin!tion is between t"edelegation o power to a2e t"e law, w"i!" ne!essarilyinvolves a dis!retion as to w"at it s"all be, and !onerringaut"ority or dis!retion as to its e*e!ution, to be e*er!isedunder and in pursuan!e o t"e law. T"e irst !annot be done; tot"e latter no valid ob3e!tion !an be ade. Over t"e years, ast"e legal engineering o enDs relations"ip be!ae oredii!ult, Congress "as to rely ore on t"e pra!ti!e odelegating t"e e*e!ution o laws to t"e e*e!utive and ot"eradinistrative agen!ies. Two tests "ave been developed todeterine w"et"er t"e delegation o t"e power to e*e!ute lawsdoes not involve t"e abdi!ation o t"e power to a2e lawitsel. Ee delineated t"e etes and bounds o t"ese tests in

Eastern Shipping 1ines7 Inc. .S . POE+, 22 t"us:

T"ere are two a!!epted tests to deterine w"et"er ornot t"ere is a valid delegation o legislative powervi2 : t"e !opleteness test and t"e sui!ient standard



test. 0nder t"e irst test, t"e law ust be !oplete inall its ters and !onditions w"en it leaves t"elegislative su!" t"at w"en it rea!"es t"e delegate t"eonly t"ing "e will "ave to do is to enor!e it. 0nder t"e sui!ient standard test, t"ere ust be adeuateguidelines or liitations in t"e law to ap out t"e boundaries o t"e delegateDs aut"ority and prevent t"edelegation ro running riot. 4ot" tests are intendedto prevent a total transeren!e o legislative aut"orityto t"e delegate, w"o is not allowed to step into t"es"oes o t"e legislature and e*er!ise a power essentially legislative.

T"e validity o delegating legislative power is now a uietarea in our !onstitutional lands!ape. 's sagely observed,delegation o legislative power "as be!oe an inevitability inlig"t o t"e in!reasing !ople*ity o t"e tas2 o governent.T"us, !ourts bend as ar ba!2 as possible to sustain t"e!onstitutionality o laws w"i!" are assailed as undulydelegating legislative powers. Citing 6irabayashi v. 3nited

States 23 as aut"ority, +r. 8usti!e Isagani '. CruB states t"ateven i t"e law does not e*pressly pinpoint t"e standard, t"e!ourts will bend over ba!2ward to lo!ate t"e sae elsew"ere

in order to spare t"e statute, i it !an, ro !onstitutionalinirity. 24

&iven t"e groove o t"e CourtDs rulings, t"e attept o petitioners to stri2e down se!tion 1= on t"e ground o unduedelegation o legislative power !annot prosper. e!tion 1= !an"urdle bot" t"e !opleteness test and t"e sui!ient standardtest. It will be noted t"at Congress e*pressly provided in -.'. o. ?1?> t"at ull deregulation will start at t"e end o +ar!"1997, regardless o t"e o!!urren!e o any event. Fullderegulation at t"e end o +ar!" 1997 is andatory and t"e%*e!utive "as no dis!retion to postpone it or any purportedreason. T"us, t"e law is !oplete on t"e uestion o t"e inal

date o ull deregulation. T"e dis!retion given to t"e residentis to advan!e t"e date o ull deregulation beore t"e end o +ar!" 1997. e!tion 1= lays down t"e standard to guide t"e 3udgent o t"e resident @ "e is to tie it as ar as

practicable w"en t"e pri!es o !rude oil and petroleu produ!ts in t"e world ar2et are declining and w"en t"ee*!"ange rate o t"e peso in relation to t"e 0 dollar is stable.

etitioners !ontend t"at t"e words as ar as pra!ti!able,de!lining and stable s"ould "ave been deined in -.'. o.?1?> as t"ey do not set deterinate or deterinable standards.T"e stubborn subission deserves s!ant !onsideration. T"edi!tionary eanings o t"ese words are well settled and !annot

!onuse en o reasonable intelligen!e. Eebster deinespra!ti!able as eaning possible to pra!ti!e or peror,de!line as eaning to ta2e a downward dire!tion, andstable as eaning irly establis"ed. 2- T"e ear o petitioners t"at t"ese words will result in t"e e*er!ise o e*e!utive dis!retion t"at will run riot is t"us groundless. To besure, t"e Court "as sustained t"e validity o siilar, i notore general standards in ot"er !ases. 2

It oug"t to ollow t"at t"e arguent t"at %.O. o. 59< is nulland void as it was based on indeterinate standards set by-.'. ?1?> ust li2ewise ail. I t"at were all to t"e atta!2

against t"e validity o %.O. o. 59<, t"e issue need not urt"erdetain our dis!ourse. 4ut petitioners urt"er posit t"e t"esist"at t"e %*e!utive isapplied -.'. o. ?1?> w"en i!onsidered t"e depletion o t"e OF und as a a!tor in ullyderegulating t"e downstrea oil industry in February 1997. ' perusal o se!tion 1= o -.'. o. ?1?> will readily reveal t"atit only enuerated two a!tors to be !onsidered by t"eepartent o %nergy and t"e Oi!e o t"e resident, vi2 .: (1t"e tie w"en t"e pri!es o !rude oil and petroleu produ!tsin t"e world ar2et are de!lining, and (<) t"e tie w"en t"ee*!"ange rate o t"e peso in relation to t"e 0 dollar is stable.e!tion 1= did not ention t"e depletion o t"e OF und asa a!tor to be given weig"t by t"e %*e!utive beore orderingull deregulation. On t"e !ontrary, t"e debates in Congress wils"ow t"at soe o our legislators wanted to ipose as a pre#!ondition to deregulation a s"owing t"at t"e OF und ustnot be in dei!it. 27 Ee t"ereore "old t"at t"e %*e!utivedepartent ailed to ollow ait"ully t"e standards set by -.' o. ?1?> w"en it !onsidered t"e e*traneous a!tor odepletion o t"e OF und. T"e isappre!iation o t"is e*traa!tor !annot be 3ustiied on t"e ground t"at t"e %*e!utivedepartent !onsidered anyway t"e stability o t"e pri!es o!rude oil in t"e world ar2et and t"e stability o t"e e*!"ange

rate o t"e peso to t"e dollar. 4y !onsidering anot"er a!tor to"asten ull deregulation, t"e %*e!utive departent rewrote t"estandards set ort" in -.'. ?1?>. T"e %*e!utive is beret oany rig"t to alter eit"er by subtra!tion or addition t"estandards set in -.'. o. ?1?> or it "as no power to a2elaws. To !ede to t"e %*e!utive t"e power to a2e law is toinvite tyranny, indeed, to transgress t"e prin!iple o separationo powers. T"e e*er!ise o delegated power is given a stri!ts!rutiny by !ourts or t"e delegate is a ere agent w"osea!tion !annot inringe t"e ters o agen!y. In t"e !ases at bart"e %*e!utive !o#ingled t"e a!tor o depletion o t"e OFund wit" t"e a!tors o de!line o t"e pri!e o !rude oil in t"eworld ar2et and t"e stability o t"e peso to t"e 0 dollar. On

t"e basis o t"e te*t o %.O. o. 59<, it is ipossible todeterine t"e weig"t given by t"e %*e!utive departent to t"edepletion o t"e OF und. It !ould well be t"e prin!ipal!onsideration or t"e early deregulation. It !ould "ave beena!!orded an eual signii!an!e. Or its iportan!e !ould be nilIn lig"t o t"is un!ertainty, we rule t"at t"e early deregulationunder %.O. o. 59< !onstitutes a isappli!ation o -.'. o?1?>.

Ee now !oe to grips wit" t"e !ontention t"at soe provisions o -.'. o. ?1?> violate se!tion 19 o 'rti!le /IIo t"e 19?7 Constitution. T"ese provisions are:

(1) e!tion = (b) w"i!" states @ 'ny law to t"e!ontrary notwit"standing and starting wit" t"eee!tivity o t"is '!t, tari duty s"all be iposedand !olle!ted on iported !rude oil at t"e rate ot"ree per!ent (5G) and iported reined petroleu produ!ts at t"e rate o seven per!ent (7G) e*!ept ueoil and $&, t"e rate or w"i!" s"all be t"e sae ast"at or iported !rude oil. rovided, t"at beginningon 8anuary 1, <>>A t"e tari rate on iported !rudeoil and reined petroleu produ!ts s"all be t"e sae

Provided7 'urther , t"at t"is provision ay beaended only by an '!t o Congress.



(<) e!tion 6 w"i!" states @ To ensure t"e se!urityand !ontinuity o petroleu !rude and produ!tssupply, t"e O% s"all reuire t"e reiners andiporters to aintain a iniu inventoryeuivalent to ten per!ent (1>G) o t"eir respe!tiveannual sales volue or orty (A>) days o supply,w"i!"ever is lower, and

(5) e!tion 9 (b) w"i!" states @ To ensure air

!opetition and prevent !artels and onopolies int"e downstrea oil industry, t"e ollowing a!ts s"all be pro"ibited:

*** *** ***

(b) redatory pri!ing w"i!" eansselling or oering to sell any produ!t at a pri!e unreasonably below t"e industry average !ost soas to attra!t !ustoers to t"edetrient o !opetitors.

On t"e ot"er "and, se!tion 19 o 'rti!le /II o t"eConstitution allegedly violated by t"e aorestated provisions o -.'. o. ?1?> andates: T"e tate s"all regulate or pro"ibitonopolies w"en t"e publi! interest so reuires. o!obinations in restraint o trade or unair !opetition s"all be allowed.

' onopoly is a privilege or pe!uliar advantage vested in oneor ore persons or !opanies, !onsisting in t"e e*!lusiverig"t or power to !arry on a parti!ular business or trade,anua!ture a parti!ular arti!le, or !ontrol t"e sale or t"ew"ole supply o a parti!ular !oodity. It is a or o ar2etstru!ture in w"i!" one or only a ew irs doinate t"e total

sales o a produ!t or servi!e. 2

On t"e ot"er "and, a!obination in restraint o trade is an agreeent or understanding between two or ore persons, in t"e or o a!ontra!t, trust, pool, "olding !opany, or ot"er or o asso!iation, or t"e purpose o unduly restri!ting !opetition,onopoliBing trade and !oer!e in a !ertain !oodity,!ontrolling its, produ!tion, distribution and pri!e, or ot"erwiseinterering wit" reedo o trade wit"out statutory aut"ority. 29

Cobination in restraint o trade reers to t"e eans w"ileonopoly reers to t"e end. 30

'rti!le 1?6 o t"e -evised enal Code and 'rti!le <? o t"e ew Civil Code breat"e lie to t"is !onstitutional poli!y.

'rti!le 1?6 o t"e -evised enal Code penaliBesonopoliBation and !reation o !obinations in restraint o trade, 31 w"ile 'rti!le <? o t"e ew Civil Code a2es any person w"o s"all engage in unair !opetition liable or daages. 32

-espondents aver t"at se!tions =(b), 6 and 9(b) ipleent t"e poli!ies and ob3e!tives o -.'. o. ?1?>. T"ey e*plain t"att"e AG tari dierential is designed to en!ourage new entrantsto invest in reineries. T"ey stress t"at t"e inventoryreuireent is eant to guaranty !ontinuous doesti! supplyo petroleu and to dis!ourage ly#by#nig"t operators. T"eyalso subit t"at t"e pro"ibition against predatory pri!ing is

intended to prote!t prospe!tive entrants. -espondentaniested to t"e Court t"at new players "ave entered t"e"ilippines ater deregulation and "ave now !aptured 5G @=G o t"e oil ar2et.

T"e validity o t"e assailed provisions o -.'. o. ?1?> "as to be de!ided in lig"t o t"e letter and spirit o our Constitutionespe!ially se!tion 19, 'rti!le /II. 4eyond doubt, t"eConstitution !oitted us to t"e ree enterprise syste but i

is a syste ipressed wit" its own distin!tness. T"us, w"ilet"e Constitution ebra!ed ree enterprise as an e!onoi!!reed, it did not pro"ibit per se t"e operation o onopoliesw"i!" !an, "owever, be regulated in t"e publi! interest. 33 T"ustoo, our ree enterprise syste is not based on a ar2et o pureand unadulterated !opetition w"ere t"e tate pursues a stri!"ands#o poli!y and ollows t"e let#t"e#devil devour t"e"indost rule. Cobinations in restraint o trade and unair!opetitions are absolutely pros!ribed and t"e pros!ription isdire!ted bot" against t"e tate as well as t"e private se!tor. 3

T"is distin!t ree enterprise syste is di!tated by t"e need toa!"ieve t"e goals o our national e!onoy as deined byse!tion 1, 'rti!le /II o t"e Constitution w"i!" are: oreeuitable distribution o opportunities, in!oe and wealt"; a

sustained in!rease in t"e aount o goods and servi!e produ!ed by t"e nation or t"e beneit o t"e people; and ane*panding produ!tivity as t"e 2ey to raising t"e uality o lieor all, espe!ially t"e underprivileged. It also !alls or t"e tateto prote!t Filipino enterprises against unair !opetition andtrade pra!ti!es.

e!tion 19, 'rti!le /II o our Constitution is anti#trust in"istory and in spirit. It espouses !opetition. T"e desirabilityo !opetition is t"e reason or t"e pro"ibition againstrestraint o trade, t"e reason or t"e interdi!tion o unai!opetition, and t"e reason or regulation o unitigatedonopolies. Copetition is t"us t"e underlying prin!iple o

se!tion 19, 'rti!le /II o our Constitution w"i!" !annot beviolated by -.'. o. ?1?>. Ee subs!ribe to t"e observation oro. Gellhorn t"at t"e ob3e!tive o anti#trust law is to assurea !opetitive e!onoy, based upon t"e belie t"at t"roug"!opetition produ!ers will strive to satisy !onsuer wants att"e lowest pri!e wit" t"e sa!rii!e o t"e ewest resour!esCopetition aong produ!ers allows !onsuers to bid ogoods and servi!es, and t"us at!"es t"eir desires wit"so!ietyDs opportunity !osts. 3- e adds wit" appropriatenesst"at t"ere is a relian!e upon t"e operation o t"e Dar2etsyste (ree enterprise) to de!ide w"at s"all be produ!ed, "owresour!es s"all be allo!ated in t"e produ!tion pro!ess, and tow"o t"e various produ!ts will be distributed. T"e ar2et

syste relies on t"e !onsuer to de!ide w"at and "ow u!"s"all be produ!ed, and on !opetition, aong produ!ers todeterine w"o will anua!ture it.

'gain, we underline in s!arlet t"at t"e undaental prin!ipleespoused by se!tion 19, 'rti!le /II o t"e Constitution is!opetition or it alone !an release t"e !reative or!es o t"ear2et. 4ut t"e !opetition t"at !an unleas" t"ese !reativeor!es is !opetition t"at is ig"ting yet is air. Ideally, t"is2ind o !opetition reuires t"e presen!e o not one, not 3ust aew but several players. ' ar2et !ontrolled by one player(onopoly) or doinated by a "andul o players (oligopoly)



is "ardly t"e ar2et w"ere "onest#to#goodness !opetitionwill prevail. +onopolisti! or oligopolisti! ar2ets deserve our !areul s!rutiny and laws w"i!" barri!ade t"e entry points o new players in t"e ar2et s"ould be viewed wit" suspi!ion.

res!inding ro t"ese baseline propositions, we s"all pro!eedto e*aine w"et"er t"e provisions o -.'. o. ?1?> on tari dierential, inventory reserves, and predatory pri!es iposedsubstantial barriers to t"e entry and e*it o new players in our

downstrea oil industry. I t"ey do, t"ey "ave to be stru!2 down or t"ey will ne!essarily in"ibit t"e oration o a truly!opetitive ar2et. Contrariwise, i t"ey are insignii!antipedients, t"ey need not be stri!2en down.

In t"e !ases at bar, it !annot be denied t"at our downstrea oilindustry is operated and !ontrolled by an oligopoly, a oreignoligopoly at t"at. etron, "ell and Calte* stand as t"e onlya3or league players in t"e oil ar2et. 'll ot"er players belong to t"e lilliputian league. 's t"e doinant players,etron, "ell and Calte* boast o e*isting reineries o various!apa!ities. T"e tari dierential o AG t"ereore wor2s tot"eir iense beneit. Let, t"is is only one edge o t"e tari dierential. T"e ot"er edge !uts and !uts deep in t"e "eart o t"eir !opetitors. It ere!ts a "ig" barrier to t"e entry o new players. ew players t"at intend to eualiBe t"e ar2et power o etron, "ell and Calte* by building reineries o t"eir ownwill "ave to spend billions o pesos. T"ose w"o will not buildreineries but !opete wit" t"e will suer t"e "ugedisadvantage o in!reasing t"eir produ!t !ost by AG. T"ey will be !opeting on an uneven ield. T"e arguent t"at t"e AGtari dierential is desirable be!ause it will indu!e prospe!tive players to invest in reineries puts t"e !art beoret"e "orse. T"e irst need is to attra!t new players and t"ey!annot be attra!ted by burdening t"e wit" "eavydisin!entives. Eit"out new players belonging to t"e league o etron, "ell and Calte*, !opetition in our downstrea oil

industry is an idle drea.

T"e provision on inventory widens t"e balan!e o advantageo etron, "ell and Calte* against prospe!tive new players.etron, "ell and Calte* !an easily !oply wit" t"e inventoryreuireent o -.'. o. ?1?> in view o t"eir e*isting storagea!ilities. rospe!tive !opetitors again will ind !oplian!ewit" t"is reuireent dii!ult as it will entail a pro"ibitive!ost. T"e !onstru!tion !ost o storage a!ilities and t"e !ost o inventory !an t"us s!are prospe!tive players. T"eir net ee!tis to urt"er o!!lude t"e entry points o new players, dapen!opetition and en"an!e t"e !ontrol o t"e ar2et by t"e t"ree(5) e*isting oil !opanies.

Finally, we !oe to t"e provision on predatory pri!ing w"i!"is deined as . . . selling or oering to sell any produ!t at a pri!e unreasonably below t"e industry average !ost so as toattra!t !ustoers to t"e detrient o !opetitors.-espondents !ontend t"at t"is provision wor2s against etron,"ell and Calte* and prote!ts new entrants. T"e ban on predatory pri!ing !annot be analyBed in isolation. Its validityis interlo!2ed wit" t"e barriers iposed by -.'. o. ?1?> ont"e entry o new players. T"e inuiry s"ould be to deterinew"et"er predatory pri!ing on t"e part o t"e doinant oil!opanies is en!ouraged by t"e provisions in t"e law blo!2ing

t"e entry o new players. Te*t#writer 6oven8amp, 3 gives t"e aut"oritative answer and we uote:

*** *** ***

T"e rationale or predatory pri!ing is t"e sustainingo losses today t"at will give a ir onopoly proitsin t"e uture. T"e onopoly proits will neveraterialiBe, "owever, i t"e ar2et is looded wit"

new entrants as soon as t"e su!!essul predatorattepts to raise its pri!e. Predatory pricing $ill be

pro'itable only i' the mar8et contains signi'ican

barriers to ne$ entry.

's aoredis!sussed, t"e AG tari dierential and t"e inventoryreuireent are signii!ant barriers w"i!" dis!ourage new players to enter t"e ar2et. Considering t"ese signii!an barriers establis"ed by -.'. o. ?1?> and t"e la!2 o playerswit" t"e !oparable !lout o %T-O, %$$ andC'$T%/, t"e teptation or a doinant player to engage in predatory pri!ing and su!!eed is a !"illing reality. etitioners!"arge t"at t"is provision on predatory pri!ing is anti

!opetitive is not wit"out reason.

-espondents belittle t"ese barriers wit" t"e allegation t"at new players "ave entered t"e ar2et sin!e deregulation. ' s!rutinyo t"e list o t"e alleged new players will, "owever, reveal t"atnot one belongs to t"e !lass and !ategory o %T-O%$$ and C'$T%/. Indeed, t"ere is no s"owing t"at any ot"ese new players intends to install any reinery andee!tively !opete wit" t"ese doinant oil !opanies. In anyevent, it !annot be gainsaid t"at t"e new players !ould "ave been ore in nuber and ore ipressive in ig"t i t"eillegal entry barriers in -.'. o. ?1?> were not ere!ted.

Ee !oe to t"e inal point. Ee now resolve t"e total e''ect ot"e untiely deregulation, t"e iposition o AG taridierential on iported !rude oil and reined petroleu produ!ts, t"e reuireent o inventory and t"e pro"ibition on predatory pri!ing on t"e !onstitutionality o -.'. o. ?1?>T"e uestion is w"et"er t"ese oending provisions !an beindividually stru!2 down wit"out invalidating t"e entire -.' o. ?1?>. T"e ruling !ase law is well stated by aut"or +gpalo37 vi2 .:

*** *** ***

T"e general rule is t"at w"ere part o a statute is void

as repugnant to t"e Constitution, w"ile anot"er part isvalid, t"e valid portion, i separable ro t"e invalid,ay stand and be enor!ed. T"e presen!e o aseparability !lause in a statute !reates t"e presuption t"at t"e legislature intended separabilityrat"er t"an !oplete nullity o t"e statute. To 3ustiyt"is result, t"e valid portion ust be so aindependent o t"e invalid portion t"at it is air to presue t"at t"e legislature would "ave ena!ted it byitsel i it "ad supposed t"at it !ould no!onstitutionally ena!t t"e ot"er. %noug" ust reainto a2e a !oplete, intelligible and valid statutew"i!" !arries out t"e legislative intent. . . .



T"e e%ception to the general rule is t"at w"en t"e parts o a statute are so utually dependent and!onne!ted, as !onditions, !onsiderations,indu!eents, or !opensations or ea!" ot"er, as towarrant a belie t"at t"e legislature intended t"e asa w"ole, t"e nullity o one part will vitiate t"e rest. Ina2ing t"e parts o t"e statute dependent,!onditional, or !onne!ted wit" one anot"er, t"elegislature intended t"e statute to be !arried out as aw"ole and would not "ave ena!ted it i one part isvoid, in w"i!" !ase i soe parts are un!onstitutional,all t"e ot"er provisions t"us dependent, !onditional,or !onne!ted ust all wit" t"e.

-.'. o. ?1?> !ontains a separability !lause. e!tion <5 provides t"at i or any reason, any se!tion or provision o t"is '!t is de!lared un!onstitutional or invalid, su!" parts notae!ted t"ereby s"all reain in ull or!e and ee!t. T"isseparability !lause notwit"standing, we "old t"at t"e oending provisions o -.'. o. ?1?> so pereate its essen!e t"at t"eentire law "as to be stru!2 down. T"e provisions on tari dierential, inventory and predatory pri!ing are aong t"e prin!ipal props o -.'. o. ?1?>. Congress !ould not "ave

deregulated t"e downstrea oil industry wit"out t"ese provisions. 0nortunately, !ontrary to t"eir intent, t"ese provisions on tari dierential, inventory and predatory pri!ing in"ibit air !opetition, en!ourage onopolisti! power and interere wit" t"e ree intera!tion o ar2et or!es. -.'. o. ?1?> needs provisions to vou!"sae ree and air !opetition. T"e need or t"ese vou!"saing provisions !annot be overstated. e'ore deregulation, %T-O, %$$ andC'$T%/ "ad no real !opetitors but did not "ave a ree runo t"e ar2et be!ause governent !ontrols bot" t"e pri!ingand non#pri!ing aspe!ts o t"e oil industry. +'ter deregulation,%T-O, %$$ and C'$T%/ reain unt"reatened by real!opetition yet are no longer sub3e!t to !ontrol by

governent wit" respe!t to t"eir pri!ing and non#pri!ingde!isions. T"e aterat" o -.'. o. ?1?> is a deregulatedar2et w"ere !opetition !an be !orrupted and w"ere ar2etor!es !an be anipulated by oligopolies.

T"e all out ee!ts o t"e dee!ts o -.'. o. ?1?> on our people "ave not es!aped Congress. ' lot o our leadinglegislators "ave !oe out openly wit" bills see2ing t"e repealo t"ese odious and oensive provisions in -.'. o. ?1?>. Int"e enate, Senator Freddie ebb "as iled .4. o. <155w"i!" is t"e result o t"e "earings !ondu!ted by t"e enateCoittee on %nergy. T"e "earings revealed t"at (1) there

$as a need to level the playing 'ield 'or the ne$ entrants in

the do$nstream oil industry, and (<) t"ere was no law punis"ing a person or selling petroleu produ!ts atunreasonable pri!es. Senator +lberto G. Romulo also iled.4. o. <<>9 abolis"ing t"e tari dierential beginning8anuary 1, 199?. e de!lared t"at t"e aendent . . . $ould mean that instead o' Hust three *, big oil companies there $ill

be other maHor oil companies to provide more competitive

prices 'or the mar8et and the consuming public. Senator

6eherson ! . +lvare2 , one o t"e principal proponents o -.'. o. ?1?>, also iled .4. o. <<9> in!reasing t"e penalty or violation o its se!tion 9. It is "is opinion as e*pressed in t"ee*planatory note o t"e bill t"at the present oil companies are

engaged in carteli2ation despite R. +. 5o. ">, vi2 ,:

*** *** ***

in!e t"e downstrea oil industry was ullyderegulated in February 1997, t"ere "ave been eig"t(?) uel pri!e ad3ustents ade by t"e t"ree oia3ors, naely: Calte* "ilippines, In!.; etronCorporation; and ilipinas "ell etroleuCorporation. ery noti!eable in t"e pri!e ad3ustentsade, "owever, is t"e uniority in t"e pup pri!es

o pra!ti!ally all petroleu produ!ts o t"e t"ree oil!opanies. T"is, despite t"e a!t, t"at t"eir sellingrates s"ould be deterined by a !obination o anyo t"e ollowing a!tors: t"e prevailing peso#dollare*!"ange rate at t"e tie payent is ade or !rude pur!"ases, sour!es o !rude, and inventory levels o bot" !rude and reined petroleu produ!ts. T"eabovestated a!tors s"ould "ave resulted in dierentrat"er t"an identi!al pri!es.

!he 'act that the three *, oil companies petroleum

products are uni'ormly priced suggests collusion7

amounting to carteli2ation, aong Calte*"ilippines, In!., etron Corporation and ilipinas"ell etroleu Corporation to i* t"e pri!es o petroleu produ!ts in violation o paragrap" (a)e!tion 9 o -.'. o. ?1?>.

To deter t"is perni!ious pra!ti!e and to assure t"a present and prospe!tive players in t"e downstrea oiindustry !ondu!t t"eir business wit" !ons!ien!e and propriety, !artel#li2e a!tivities oug"t to be severely penaliBed.

Senator Francisco S . !atad also iled .4. o. <5>7 providingor a unior tari rate on iported !rude oil and reined

petroleu produ!ts. In t"e e*planatory note o t"e bill, "ede!lared in no un!ertain ters t"at . . . the present set;up "asraised serious publi! !on!ern over t"e way t"e t"ree oi!opanies "ave uniorly ad3usted t"e pri!es o oil in t"e!ountry, an indication o' a possible e%istence o' a cartel or a

cartel;li8e situation $ithin the do$nstream oil industry . !his situation is mostly attributed to the 'oregoing provision on

tari'' di''erential7 $hich has e''ectively discouraged the entry

o' ne$ players in the do$nstream oil industry.

In the 6ouse o' Representatives, t"e oves to re"abilitate -.' o. ?1?> are eually everis". Representative 1eopoldo ESan uenaventura "as iled .4. o. 9?<6 reoving t"e tari

dierential or iported !rude oil and iported reined petroleu produ!ts. In t"e e*planatory note o t"e bill, -ep4uenaventura e*plained:

*** *** ***

's we now e*perien!e, t"is dieren!e in tari rates between iported !rude oil and iported reined petroleu produ!ts, un$ittingly provided a built;in;

advantage 'or the three e%isting oil re'ineries in thecountry and eliminating competition $hich is a must

in a 'ree enterprise economy. +oreover, it !reated adisin!entive or ot"er players to engage even initially



in t"e iportation and distribution o reined petroleu produ!ts and ultiately in t"e putting upo reineries. !his tari'' di''erential virtually created a monopoly o' the do$nstream oil industry by the

e%isting three oil companies as s"own by t"eir unior and !apri!ious pri!ing o t"eir produ!ts sin!et"is law too2 ee!t, to t"e great disadvantage o t"e!onsuing publi!.

T"us, instead o a!"ieving t"e desired ee!ts o deregulation, t"at o ree enterprise and a level playing ield in t"e downstrea oil industry, -.'.?1?> "as !reated an environent !ondu!ive to!arteliBation, unavorable, in!reased, unrealisti! pri!es o petroleu produ!ts in t"e !ountry by t"et"ree e*isting reineries.

Representative 9arcial C . Pun2alan7 4r ., iled .4. o. 99?1to prevent !ollusion aong t"e present oil !opanies bystrengt"ening t"e oversig"t un!tion o t"e governent, parti!ularly its ability to sub3e!t to a review any ad3ustent int"e pri!es o gasoline and ot"er petroleu produ!ts. In t"ee*planatory note o t"e bill, -ep. unBalan, 8r., said:

*** *** ***

To avoid t"is, t"e proposed bill see2s to strengt"ent"e oversig"t un!tion o governent, parti!ularly itsability to review t"e pri!es set or gasoline and ot"er petroleu produ!ts. It grants t"e %nergy -egulatory4oard (%-4) t"e aut"ority to review pri!es o oil andot"er petroleu produ!ts, as ay be petitioned by a person, group or any entity, and to subseuently!opel any entity in t"e industry to subit any andall do!uents relevant to t"e iposition o new

pri!es. In !ases w"ere t"e 4oard deterines t"at t"eree*ist !ollusion, e!onoi! !onspira!y, unair trade pra!ti!e, proiteering andor overpri!ing, it ay ta2eany step ne!essary to prote!t t"e publi!, in!luding t"eread3ustent o t"e pri!es o petroleu produ!ts.Furt"er, t"e 4oard ay also ipose t"e ine and penalty o iprisonent, as pres!ribed in e!tion 9o -.'. ?1?>, on any person or entity ro t"e oilindustry w"o is ound guilty o su!" pro"ibited a!ts.

4y doing all o t"e above, t"e easure willee!tively provide Filipino !onsuers wit" a venuew"ere t"eir grievan!es !an be "eard and iediately

a!ted upon by governent.

T"us, t"is bill stands to beneit t"e Filipino !onsuer by a2ing t"e pri!e#setting pro!ess ore transparentand a2ing it easier to prose!ute t"ose w"o perpetrate su!" pro"ibited a!ts as !ollusion,overpri!ing, e!onoi! !onspira!y and unair trade.

Representative Sergio +. F . +postol iled .4. o. 1>>59 toreedy an oission in -.'. o. ?1?> w"ere t"ere is noagen!y in governent t"at deterines w"at is reasonablein!rease in t"e pri!es o oil produ!ts. Representative Dente O.!inga, one o t"e principal sponsors o -.'. o. ?1?>, iled

.4. o. 1>>=7 to strengt"en its anti#trust provisions. eelu!idated in its e*planatory note:

*** *** ***

T"e deinition o predatory pri!ing, "owever, needsto be tig"tened up parti!ularly wit" respe!t to t"edeinitive ben!"ar2 pri!e and t"e spe!ii! anti!opetitive intent. T"e deinition in t"e bill at "and

w"i!" was ta2en ro t"e +reeda;!urner test in t"e0nited tates on predatory pri!ing resolves t"euestions. T"e deinition reads, redatory pri!ingeans selling or oering to sell any oil produ!t at a pri!e below t"e average variable !ost or t"e purposeo destroying !opetition, eliinating a !opetitoror dis!ouraging a !opetitor ro entering t"ear2et.

T"e appropriate a!tions w"i!" ay be resorted tounder t"e -ules o Court in !on3un!tion wit" t"e oilderegulation law are adeuate. 4ut to stress t"eiravailability and dynais, it is a good ove to

in!orporate all t"e reedies in t"e law itsel. T"ust"e present bill oraliBes t"e !on!ept o governenintervention and private suits to address t"e probleo antitrust violations. pe!ii!ally, t"e governentay ile an a!tion to prevent or restrain any a!t o!arteliBation or predatory pri!ing, and i it "assuered any loss or daage by reason o t"e antitrustviolation it ay re!over daages. $i2ewise, a private person or entity ay sue to prevent or restrain anysu!" violation w"i!" will result in daage to "is business or property, and i "e "as already suereddaage "e s"all re!over treble daages. ' !lass suitay also be allowed.

To a2e t"e O% e!retary ore ee!tive in t"eenor!eent o t"e law, "e s"all be given additiona powers to gat"er inoration and to reuire reports.

Representative Erasmo . Damasing iled .4. o. 7??= and"as a ore unorgiving view o -.'. o. ?1?>. e wants it!opletely repealed. e e*plained:

*** *** ***

Contrary to t"e pro3e!tions at t"e tie t"e bill on t"eownstrea Oil Industry eregulation was dis!ussed

and debated upon in t"e plenary session prior to itsapproval into law, t"ere arenDt any new players orinvestors in t"e oil industry. T"us, resulting in pra!ti!ally a !artel or onopoly in t"e oil industry byt"e t"ree (5) big oil !opanies, Calte*, "ell andetron. o u!" so, t"at wit" t"e deregulation now being partially ipleented, t"e said oil !opanies"ave su!!eeded in in!reasing t"e pri!es o ost ot"eir petroleu produ!ts wit" little or no intereren!eat all ro t"e governent. In t"e ont" o 'ugustt"ere was an in!rease o Fity !entavos (=>[) per liter by subsidiBing t"e sae wit" t"e OF, t"is is onlyteporary as in +ar!" 1997, or a ew ont"s ro



now, t"ere will be ull deregulation ("ase II)w"ereby t"e in!rease in t"e pri!es o petroleu produ!ts will be ully absorbed by t"e !onsuerssin!e OF will already be abolis"ed by t"en.Certainly, t"is would a2e t"e lives o our people,espe!ially t"e uneployed ones, doubly dii!ult andunbearable.

T"e u!" bally"ooed !oing in o new players in

t"e oil industry is uite reote !onsidering t"at t"ese prospe!tive investors !annot ig"t t"e e*isting andwell establis"ed oil !opanies in t"e !ountry today,naely, Calte*, "ell and etron. %ven i t"ese new players will !oe in, t"ey will still "ave no !"an!e to!opete wit" t"e said t"ree (5) e*isting big oil!opanies !onsidering t"at t"ere is an iposition o oil tari dierential o AG between iportation o !rude oil by t"e said oil reineries paying only 5Gtari rate or t"e said iportation and 7G tari rateto be paid by businessen w"o "ave no oil reineriesin t"e "ilippines but will iport inis"ed petroleuoil produ!ts w"i!" is being ta*ed wit" 7Gtari rates.

So7 i' only to help the many $ho are poor 'rom

'urther su''ering as a result o' unmitigated increasein oil products due to deregulation7 it is a must that

the Do$nstream Oil Industry Deregulation +ct o'

"?7 or R. +. "> be repealed completely.

arious resolutions "ave also been iled in t"e enate !allingor an immediate and comprehensive revie$ o -.'. o. ?1?>to prevent t"e downpour o its ill ee!ts on t"e people. T"us,. -es. o. =7A was iled by Senator Gloria 9 . 9acapagal entitled -esolution ire!ting t"e Coittee on %nergy toInuire Into T"e roper Ipleentation o t"e eregulation o t"e ownstrea Oil Industry and Oil Ta* -estru!turing 's+andated 0nder -.'. os. ?1?> and ?1?A, In Order to +a2eT"e e!essary Corre!tions In t"e 'pparent +isinterpretationO T"e Intent 'nd rovision O T"e $aws 'nd Curb T"e-ising Tide O isen!"antent 'ong T"e FilipinoConsuers 'nd 4ring 'bout T"e -eal Intentions 'nd4eneits O T"e aid $aw. Senator las P . Ople iled . -es. o. 66A entitled resolution ire!ting t"e Coittee on%nergy To Condu!t 'n Inuiry In 'id O $egislation To-eview T"e &overnentDs Oil eregulation oli!y In $ig"tO T"e u!!essive In!reases In Transportation, %le!tri!ity'nd ower -ates, 's well 's O Food 'nd Ot"er rieCoodities 'nd -e!oend 'ppropriate 'endents To

rote!t T"e Consuing ubli!. enator Ople observed:

*** *** ***

E%-%', sin!e t"e passage o -.'. o. ?1?>, t"e%nergy -egulatory 4oard (%-4) "as iposedsu!!essive in!reases in oil pri!es w"i!" "as triggeredin!reases in ele!tri!ity and power rates, transportationares, as well as in pri!es o ood and ot"er prie!oodities to t"e detrient o our people, parti!ularly t"e poor;

E%-%', t"e new players t"at were e*pe!ted to!opete wit" t"e oil !artel#"ell, Calte* and etron#"ave not !oe in;

E%-%', it is iperative t"at a review o t"e oideregulation poli!y be ade to !onsider appropriateaendents to t"e e*isting law su!" as an e*tensiono t"e transition p"ase beore ull deregulation inorder to give the competitive mar8et enough time to

develop;

E%-%', t"e review !an in!lude t"e advisabilityo providing soe in!entives in order to attra!t t"eentry o new oil !opanies to ee!t a dynai!!opetitive ar2et;

E%-%', it ay also be ne!essary to deer t"esetting up o t"e institutional raewor2 or ulderegulation o t"e oil industry as andated under%*e!utive Order o. 577 issued by resident -aoslast O!tober 51, 1996 . . .

Senator +lberto G. Romulo iled . -es. o. 769 entitledresolution ire!ting t"e Coittees on %nergy and ubli!ervi!es In 'id O $egislation To 'ssess T"e Iediate+ediu 'nd $ong Ter Ipa!t o Oil eregulation On Oiri!es 'nd T"e %!onoy. 'ong t"e reasons or t"eresolution is t"e inding t"at the re0uirement o' a =>;day

stoc8 inventory e''ectively limits the entry o' other oil 'irms in

the mar8et $ith the conse0uence that instead o' going do$noil prices $ill rise.

Parallel resolutions have been 'iled in the 6ouse o'

Representatives. Representative Dante O. !inga iled . -es o. 1511 ire!ting T"e Coittee on %nergy To Condu!

'n Inuiry, In 'id o $egislation, Into T"e ri!ing oli!ies'nd e!isions O T"e Oil Copanies in!e T"eIpleentation o Full eregulation 0nder t"e Oieregulation '!t (-.'. o. ?1?>) For t"e urpose oeterining In t"e Conte*t O T"e Oversig"t Fun!tions OCongress E"et"er T"e Condu!t O T"e Oil CopaniesE"et"er ingly Or Colle!tively, Constitutes CarteliBationE"i!" Is ' ro"ibited '!t 0nder -.'. o. ?1?>, 'nd E"at+easures "ould 4e Ta2en To elp %nsure T"e u!!essuIpleentation O T"e $aw In '!!ordan!e Eit" Its $etter'nd pirit, In!luding -e!oending Criinal rose!ution Ot"e Oi!ers Con!erned O t"e Oil Copanies I Earranted 4yT"e %viden!e, 'nd For Ot"er urposes. Representatives

9arcial C . Pun2alan7 4r . Dante O. !inga and +ntonio E eng2on III iled .-. o. ?9A dire!ting t"e ouse Coitteeon %nergy to inuire into t"e proper ipleentation o t"ederegulation o t"e downstrea oil industry. ouse -esolution o. 1>15 was also iled by Representatives Edcel C . 1agman7

Enri0ue ! . Garcia7 4r . and 4o8er P . +rroyo urging t"eresident to iediately suspend t"e ipleentation o %.O o. 59<.

In re!ent eory t"ere is no law ena!ted by t"e legislatureali!ted wit" so u!" !onstitutional deorities as -.'. o?1?>. Let, -.'. o. ?1?> deals wit" oil, a !oodity w"osesupply and pri!e ae!t t"e ebb and low o t"e lieblood o t"e



nation. Its s"ortage o supply or a slig"t, upward spiral in its pri!e s"a2es our e!onoi! oundation. tudies s"ow t"at t"eareas ost ipa!ted by t"e oveent o oil are oodanua!ture, land transport, trade, ele!tri!ity and water. 3 +t a

time $hen our economy is in a dangerous do$nspin7 the

perpetuation o' R. +. 5o. "> threatens to multiply the

number o' our people $ith bent bac8s and begging bo$ls. R. +. 5o. "> $ith its anti;competition provisions cannot be

allo$ed by this Court to stand even $hile Congress is $or8ing

to remedy its de'ects.

T"e Court, "owever, ta2es note o t"e plea o %T-O,%$$ and C'$T%/ to lit our restraining order to enablet"e to ad3ust upward t"e pri!e o petroleu and petroleu produ!ts in view o t"e plueting value o t"e peso. T"eir plea, "owever, will now "ave to be addressed to t"e %nergy-egulatory 4oard as t"e ee!t o t"e de!laration o un!onstitutionality o -.'. o. ?1?> is to revive t"e orer laws it repealed. 39 T"e lengt" o our return to t"e regie o regulation depends on Congress w"i!" !an asttra!2 t"ewriting o a new law on oil deregulation in a!!ord wit" t"eConstitution.

Eit" t"is e!ision, soe !ir!les will !"ide t"e Court or interering wit" an e!onoi! de!ision o Congress. u!"!riti!is is !"arless or t"e Court is annulling -.'. o. ?1?>not be!ause it disagrees wit" deregulation as an e!onoi! poli!y but be!ause as !obbled by Congress in its present or,t"e law violates t"e Constitution. T"e rig"t !all t"ereor s"ould be or Congress to write a new oil deregulation law t"at!onors wit" t"e Constitution and not or t"is Court to s"ir2 its duty o stri2ing down a law t"at oends t"e Constitution.tri2ing down -.'. o. ?1?> ay !ost losses in uantiiableters to t"e oil oligopolists. 4ut t"e loss in tolerating t"etapering o our Constitution is not uantiiable in pesos and!entavos. +ore wort"y o prote!tion t"an t"e supra#noral

proits o private !orporations is t"e san!tity o t"eundaental prin!iples o t"e Constitution. Indeed w"en!onronted by a law violating t"e Constitution, t"e Court "asno option but to stri2e it down dead. $est it is issed, t"eConstitution is a !ovenant t"at grants and guarantees both t"e politi!al and economic rights o' the people. T"e Constitutionandates t"is Court to be t"e guardian not only o t"e peopleDs politi!al rig"ts but t"eir e!onoi! rig"ts as well. T"e prote!tion o t"e e!onoi! rig"ts o t"e poor and t"e powerless is o greater iportan!e to t"e or t"ey are!on!erned ore wit" t"e e*oteri!s o living and less wit" t"eesoteri!s o liberty. en!e, or as long as t"e Constitutionreigns supree so long will t"is Court be vigilant in up"olding

t"e e!onoi! rig"ts o our people espe!ially ro t"eonslaug"t o t"e powerul. Our deense o t"e peopleDse!onoi! rig"ts ay appear "eartless be!ause it !annot be"al#"earted

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